The Covid-19 pandemic saw a temporary ceasefire from activist investors as they stepped back and allowed businesses to adjust to the acute turmoil. But now that the dust has somewhat settled, activists are once again setting their sights on companies they believe are undervalued or mismanaged – two qualities that have been underscored by this crisis.
As the vultures prepare to take flight, Darren Novak, head of activist defence at UBS says: “many public companies have seen their pre-crisis valuation issues exacerbated and may see activist investors seize an opportunity to launch campaigns as we head into the second half of this year.” Some executives could find themselves never returning to the office for reasons other than lockdown restrictions.
The UK is the main activist stomping ground in Europe, and it would appear that the post-‘Corona crunch’ offensive has already begun. This week, London-based Gatemore Capital snapped up a 3 per cent stake in former retail darling Superdry (SDRY), betting that it can help return the shares to vogue. That follows Europe’s biggest activist investor, Cevian Capital, initiating its advance on Pearson (PSON) back in June – the Swedish investor has since upped its stake in the academic publisher to 7 per cent.