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Andrew Freedman and Ryan Nebel Quoted in Agenda on “Kill-the-Deal” Campaigns

November 11, 2019

Co-Head of Olshan's Shareholder Activism Practice Andrew Freedman and Shareholder Activism partner Ryan Nebel were quoted in Agenda (subscription required) on the rising trend of “kill-the-deal” activist campaigns, as opposed to activists advocating for the consummation of an M&A deal. M&A-themed campaigns accounted for 45% of the 159 campaigns launched in the first three quarters of 2019, and “more than ever before,” Mr. Freedman notes, activists in 2019 have opposed these deals. “Post-deal announcement activist activity is surging,” he explains, especially for activists who are also stakeholders in the buying company of an M&A transaction. “With such a flurry of deal activity this year,” he adds, “it is not surprising to see an activist play a central role in questioning whether the right deal is proposed at the right price.” Given the gravity of M&A transactions, activists are understandably concerned over a “flawed process” in structuring a particular deal: “M&A is the end-all, be-all of a company cycle, so you can rest assured that shareholders want to make certain they are getting the best deal possible for the best premium possible. So, if anything is flawed, you can be sure there will be activist activity around that deal.” Only nine proxy contests at public U.S. companies went to a vote in the first three quarters of 2019, a decrease from previous years, but Mr. Nebel argues that this ostensible slowdown is actually explained by activists taking a less public approach and early-stage settlements. “We get new clients on a daily basis,” he commented, “and a lot of them are making a foray into activism for the first time. More and more funds are delving into this area of investing.”

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