DealLawyers.com Blog

This Lazard report reviews shareholder activism during the first half of 2022. Here are some of the highlights:

– Despite a challenging investing environment in 2022, activity remains elevated – Q2 was the second most active quarter in the past five quarters (behind only a record-setting Q1.

– Global campaign activity for Q2 (53 campaigns) down 27% vs. Q1, in line with Q1/Q2 pattern of recent years. Regionally, the decline was most acute in the U.S., where activity materially declined by 50% to 22 new campaigns. By contrast, Europe saw a strong Q2 with a 33% increase over Q1 levels

– Technology companies accounted for 1 out of every 4 activist targets in Q2, resulting in Technology being the most targeted sector in H1 (21% of all campaigns, well above 14% multi-year average). Software, Services and Internet were the most active subsectors,

– The challenging macroeconomic and investing environment influenced activists’ demands in H1 2022.  The number of “sell the company” demands was 7 in Q2, bringing the H1 total to 16 (rivaling full year totals of 20 in 2021 and 14 in 2020), as activists pushed the M&A option as an alternative to what they perceived as failed stand-alone strategies.

− As the economic outlook deteriorated through Q2 there was increased focus on strategy and operations (21% of campaigns in Q2 vs. 14% in Q1) and capital allocation policies (17% of campaigns in Q2 vs. 10% in Q1)

The report also says that first time activists accounted for 37% of all activists launching campaigns in H1, the highest level in recent years.  Campaigns were also more dispersed, with the top five activists accounting for only 19% of all campaigns – which is below the concentration levels see over the past five years.

– John Jenkins