September 4, 2013

Study: 2000 Hedge Fund “Interventions”

Recently, Professor Lucian Bebchuk wrote this WSJ op-ed entitled “The Myth of Hedge Funds as ‘Myopic Activists,'” which summarizes his co-authored empirical study that purportedly refutes the long-held belief that hedge fund activists focused on short-term profits harm issuers’ and shareholders’ long-term interests. The study – entitled “The Long-Term Effects of Hedge Fund Activism” – entails an analysis of 2,000 hedge fund “interventions” between 1994 and 2007 with tracking for five years subsequent to the hedge fund activists’ initial interventions.

And here are empirical & methodological concerns with the Bebchuk study raised by Wachtell Lipton…and then here is Lucian Bebchuk’s rebuttal to the rebuttal…