IN-DEPTH: New activists join the fray in 2024
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As the universe of activists continues to expand and diversify, many joined the fray in 2024.
Five first-time primary and partial-focus activists made 18 public demands across the globe in the period, according to Diligent Market Intelligence (DMI) Activism data.
Below, DMI takes a look at some of 2024's newcomers and how their engagements progressed:
AJ Investments and Partners
Partial-focus activist AJ Investments and Partners took its first foray into activism in 2024, making demands of French video game maker Ubisoft.
In September, the Slovakia-based hedge fund urged Ubisoft to launch a sale process and to replace CEO and co-founder Yves Guillemot, making the case that a new leader could better simplify its cost and studio structure.
AJ said that the founding Guillemot family and their partner Chinese internet giant Tencent – which collectively control a 25% stake – should make a “fair” buyout offer or allow the company to run a formal sale process while threatening a proxy contest if its demands were not met.
In January this year, Ubisoft hired advisors to “review and pursue various transformational strategic and capitalistic options,” with the Guillemot family and Tencent keen to retain control over the company in the event of a management-led buyout.
Ubisoft has stated it hopes to cut costs by 200 million euros ($206 million) by the 2025-26 financial year after closing three studios in “high-cost geographies” in December.
AJ employs a focus on real estate and energy businesses with high growth potential, according to its official website.
DMI data show that AJ’s total average follower return stands at negative 11.2%.
Ananym Capital Management
In November, U.S.-based investment firm Ananym Capital Management advanced a host of demands at healthcare products distributor Henry Schein, a company that had been profiled as vulnerable to activism in a February report by DMI.
In its first public campaign, Ananym pushed Henry Schein to refresh its board, cut costs, tackle succession planning and consider selling its medical distribution business. The dissident group also pressed for an integration of recent acquisitions. Some days later, Henry Schein unveiled plans to purchase Acentus, a supplier of wearable devices that track blood sugar in real time.
The $256-million investor group was formed earlier in the year by Charlie Penner and Alex Silver.
According to its website, Ananym elects to pursue discussions with leadership as well as deploying a variety of traditional activist techniques to address operational performance, capital allocation and strategic transactions.
Ananym's total average follower return stands at negative 5.7%.
Carronade Capital Management
Connecticut-based investment firm Carronade Capital Management kicked off its first activist venture in October when it called on shareholders of U.S. telecom company Frontier Communications Parent to reject a $38.50-per-share takeover offer from Verizon.
The $2 billion partial-focus activist argued that Verizon’s offer was “insufficient compared to the intrinsic value of the company,” which it placed at around $48.60 per share. The deal was also opposed by fellow Frontier shareholders Glendon Capital Management, Cerberus Capital Management and Cooper Investors.
In the following weeks, both Institutional Shareholder Services (ISS) and Glass Lewis produced issued reports recommending that shareholders should abstain from voting on the takeover bid and instead support a proposal to adjourn. The deal was ultimately supported by 63% of the votes cast at a November 13 meeting.
Carronade’s total average follower return stands at 30%.
iolite Capital Management
Switzerland-based iolite Capital Management, an investment manager solely run by former Goldman Sachs analyst Robert Leitz, was founded in 2008 but ran its first public campaign last August, pushing Australian coal miner Bowen Coking Coal to revamp its board while advancing its own three-person slate.
Iolite specifically targeted the removal of executive Chairman Nicholas Jorss and director Neville Sneddon, proposing the appointment of Leitz, and later expanded its slate to include Peter Thorsen and Patrick O’Connor.
iolite withdrew its proposals on September 26 after Bowen’s stock declined more than 32% during the month, with fellow Bowen shareholder and occasional activist Regal Funds Management also selling off over half of its 10% stake in the target.
iolite’s total average follower return stands at negative 63.2%.
Lanyon Asset Management
Australia-based Lanyon Asset Management was founded in 2010 and is headed up by Managing Director and Portfolio Manager David Prescott with bases in Adelaide and Sydney. It manages an investment fund for institutional investors, family offices, charities and foundations, athletes and private investors.
Lanyon made its first move in public shareholder activism in December, requisitioning a special meeting at Fat Prophets Global Property Fund (FPP) to consider a wind up of the Australian REIT.
At a special meeting on January 25, more than 52% of votes cast at the meeting were in favor of the proposal. The company later commenced engagement with the Australian Securities Exchange (ASX) in respect to the removal of FPP from the official list of ASX.
Lanyon’s total average follower return stands at 7.8%.
