As BHP Billiton fends off the attention of Elliott Management, activist funds are targeting other Australian firms, shaking up a corporate culture that has long favoured quiet chats over splashy headlines.
Seeking new, less crowded markets, international activist investors are using Australia’s shareholder-friendly laws to pressure corporate boards criticised as clubby and conservative in an effort to improve returns.
“Whereas before it was quite normal for companies to address any potential shareholder activism in Australia behind closed doors, only now is there a real appetite to go public and to take the message direct to shareholders,” said Michael Chandler, governance director at shareholder engagement firm Global Proxy Solicitation.
Activists publicly targeted 26 ASX-listed companies in the first five months of 2017, a quarter more than same period five years ago, according to data from research firm Activist Insight.
While the number of targets is similar to last year, the size of targets has jumped. Elliott’s three-month campaign targeting “The Big Australian” BHP has cemented the idea that no company is immune. The strategy appears to be bearing some fruit, with activist shareholders winning board-level resignations or strategy changes.
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