Activists target US companies

Oct 31, 2017
Financial companies the most heavily targeted sector

Activists this year have set their sights on US companies, with 395 from a total of 640 activist demands year to date (YTD) leveled at companies in the States. Thirty-two of those focused on US companies in September alone.

After the US, the geographical areas most heavily targeted were Europe (excluding the UK) with 67 demands YTD and Asia with 55, according to the latest data from Activist Insight.     

Looking at activity by sector, financial companies were the most targeted YTD with 21.3 percent of overall demands, but both services (29.6 percent) and basic materials (25.9 percent) had more companies targeted in September, compared with 14.8 percent for financials.

Commenting, Josh Black, editor-in-chief at Activist Insight, says: ‘Activism has continued to be a major force even in rising markets, with the number of targets plateauing at a relatively high level. A strong interest in unlocking conglomerate, real estate and fund discounts has put service and financial companies in activist spotlights.’

When it comes to activist company targets by market capitalization, small caps topped the list with 25 percent of demands YTD followed by 22.8 percent for large caps, but micro-caps saw the largest percentage for September with 25.9 percent.

Types of activist demand were dominated by board-related issues, with 43.1 percent YTD and 48.9 percent for September.   

‘As advance notice bylaws for the 2018 proxy season start to come into effect, and with a flurry of late 2017 proxy contests, this year has seen a high incidence of activists seeking board representation,’ notes Black.

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