Number of firms targeted by activists more than doubles in Asia
A sea change in shareholder activism across Asia has seen the number of companies publicly targeted more than double between 2013 and 2016, according to Activist Insight data.
As many as 38 companies were subjected to public shareholder demands during the first half of 2017, more than in 2013 as a whole, and setting the stage for a projected year-end total of 65. And although 2017 volume is anticipated to dip, activism is far from losing momentum.
Activist Insight editor-in-chief Josh Black says: ‘Although activity remains dramatically lower than in the US, several developments suggest activism in Asia will continue to increase, including governments pushing for improved corporate governance, new domestic activist fund launches and the ready availability of opportunities.
‘Deterrents, such as controlled companies and suspicion of outsiders can be dispelled with sustained effort. But activists have been working more closely with management teams and gaining their trust before or in place of going public with demands.
The report also reveals that activists are increasingly looking to foreign institutional investors and family offices as fertile ground for their campaigns.
‘Foreign institutional investors tend to be more independent of local banks and pension services and therefore have a different mind-set, as well as being influenced by western governance standards. Family offices may also have fewer ties and be more interested in profitable investments than relationships,’ Black says.