Frank Aquila and Melissa Sawyer Author Corporate Secretary Article on Activism After the PandemicApril 6, 2020 Authors: Francis J. Aquila, Melissa Sawyer
Frank Aquila, S&C’s global head of M&A, co-authored an article in Corporate Secretary with Melissa Sawyer, the co-head of S&C’s corporate governance practice. The article, titled “How boards can prepare for post-pandemic activism,” examines the ways and means by which shareholder activism may see a rise as the market emerges from the pandemic, and how companies can be ready.
The authors begin by noting that “[p]ublic companies often experience an uptick in activist demand and unsolicited offers after…periods of exceptional turbulence,” citing the days that followed the 2008 financial crisis as an example. While public company boards are currently understandably focused on managing the immediate issues associated with the crisis, the authors say that in the long term they should prepare for unsolicited takeover bids and short-selling; proxy contests; and “activist demands that combine the activist’s primary investment theses with criticism of the company or managements Covid-19 response.”
To prepare for these possibilities, the authors say, “companies should work closely with their internal and external advisers to plan for responding to a potential activist’s or bidder’s demands, including by engaging with institutional investors, regulators and other stakeholders, as well as monitoring changes in the legal and regulatory environment.”
To read the full article, click here.