November 4, 2015
Bruce Goldfarb Quoted in The New York Times on Advising Corporations Facing Shareholder Activism
Activist Investors Get a Welcome Seat at the Table
For decades, corporate America rejected activist investors, accusing them of being corporate raiders out to make a quick buck. But these days, some of America’s biggest companies are trying to think more like them.
When United Technologies weighed the possibility of selling or spinning off its Sikorsky Aircraft helicopter business this year, its chief executive went on television to explain why. “As I told both our board and our shareholders, I want to be the activist within,” Gregory J. Hayes, the chief executive, told CNBC, adding that he would prefer this to “worrying about somebody coming from outside.”
Several months later, United Technologies sold Sikorsky to Lockheed Martin for $9 billion. In making that move, Mr. Hayes was taking a page out of the activist investor’s playbook: Examine the various businesses of a company to determine whether it is more valuable as a whole or as parts.
Activist hedge funds that buy stakes in companies with the intention of agitating for change are not going away. And as they swell in numbers and size — with more than $129 billion in assets today, according to research from HFR — corporations have found a new way to deal with them by adopting some of their methods.
“We have a number of corporate clients where we have a discussion with management and sometimes at the board level about how to think like an activist,” said Bruce H. Goldfarb, the chief executive of Okapi Partners, a proxy solicitation firm that advises corporations and shareholders, including activist investors, on voting matters and proxy fights.
Read the rest of the article via The New York Times