Where were activists most active in 2016?
Of the 758 companies targeted last year by shareholder activists, 505 were based in North America, according to Activist Insight.
The US saw a 9 percent increase in companies targeted, from 418 in 2015 to 456 in 2016. In Canada, however, there was an 18 percent fall in the number of companies subjected to activist campaigns, from 60 campaigns in 2015 to 49 in 2016.
‘The drop in oil prices has impacted the energy sector disproportionately and with Canada being a primarily resources-based economy it has been a very difficult time to create value if you’re an activist,’ says Josh Black, editor-in-chief of Activist Insight, in our latest video interview.
The number of campaigns in Europe increased by 35 percent, from 72 in 2015 to 97 in 2016. According to the Activist Investing Annual Review, the proportion of campaigns initiated by Europe-based firms rose from 62 percent in 2015 to 76 percent last year.
‘There has historically been more activism in Northern Europe, but now there are also funds getting involved in Southern European markets,’ Black says. ‘France and Italy have seen investors become aware of the opportunities and legal advantages they may have there.’
Yet the largest growth in activist campaigns has been in Asia, which saw a 48 percent increase last year. While Australia remains the third-most popular country in the world for activist campaigns, there was also a noted rise of activity in Japan, Hong Kong, Singapore, China and South Korea during 2016.
Black says: ‘There’s been a big push in certain Asian markets to improve corporate governance… it’s notable that there are more home-grown activists.’
Click the video link below to watch the complete Q&A with Black, where we dive further into regional trends and characterize how different activist styles have emerged.
In last week’s video, Black discussed how politics and economics drove trends in activist performance last year. In next week’s video, he will talk about what IR professionals can do if they see an activist on their shareholder register.