Shareholder Defense

FTI Consulting can help improve the odds for companies defending activist investor advances

While many companies have made affirmative strides in their own self-analysis when engaged in defense of activist investment, very few employ heavily analytical communications strategies to deconstruct activists’ track records and inform the world about them.

Conventional wisdom has defined how companies currently respond to activist advances:

  • Analyze your business the same way activists will.
  • Prepare a defense based on understanding and predicting the activist approach.
  • Create an internal and external team of “A” players.
  • Track the stock performance of companies where the activist has been involved.
  • Take actions that may mitigate potential activist arguments including:
    • Self-benchmark and scrub G&A and CapEx spending.
    • Add qualified persons to the board, consider capital allocation changes.
    • Take a critical look at CapEx.
    • Anticipate responses to financial anomalies that will make you vulnerable to valid, and not-so-valid criticism.
    • Analyze shareholder voting trends, relationships with proxy advisory firms, and proxy decision making process.
    • Review historical proxy advisory firm analysis regarding dissidents and activism in the industry, including a review of all relevant ISS investor decks.

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