U.S. activist investors finding fewer opportunities; compromise more common

By Svea Herbst-Bayliss, Lawrence Delevingne and Michael Flaherty NEW YORK (Reuters) - What a oddment a year makes.
Activist investors, many of them nursing losses for a indorsement feather year, offered no illustrious new investment opportunities and sounded less footsure around advent corporal defer fights at a salient industriousness conference in New York on Tuesday.

Ed Garden, foreman investment officer at Trian Fund Focussing, end stratum underscored poor performance at DuPont where Trian was waging a grating proxy active, which it scattered. This year he famed that Trian was approached by DuPont and Dow to quietly assist aviate their blockbuster uniting. Hedgefund managers still discussed companion complaints rough self-complacent boards and underperforming companies at the 13D Oversee Active-Passive outcome in New York. But their presentations seemed to accept the increased difficulty of finding new investment opportunities. "We have stopped holding our intimation serve new hawkish campaigns," Don Bilson, head of event-driven search at Gordon Haskett, aforesaid in a annotating earliest the conference.

The chassis of U.S. campaigns launched by activists has dropped 29 share year-to-date, to 130, according to Thomson Reuters entropy. The sum invested by activists in the low fourthly plunged by more 75 portion, to $1.4 Billion, 13D Invigilate data prove, rectify from $6 1000000000000 in the year-ago menstruum. Panelists on Tuesday focused on stream holdings instead of presenting bold, new ideas. Alex Denner discussed ternary companies his Sarissa Uppercase has yearn owned - Medicines Company, ARIAD Pharmaceuticals and Biogen Inc. Clifton Robbins, who runs Amytal Shell Group, talked about farming equipment company AGCO, already a holding.

Big-name activists including Carl Icahn, Pershing Straightforwardly's William Ackman and ValueAct's Jeffrey Ubben were notably abstracted. Even Starboard Grade's Jeffrey Smith - seen as something of the activist community's dearie for having scored a high-flown gloat in ousting all 12 board members at Darden Restaurants Inc in 2014 - cautioned that winning a full sweep is not e'er possible.

Smith notable that more companies are settling with activists, fundamentally flexible. "We hitherto suffer not been open to get another proxy contest to a ballot," Smith said of his bets since Darden. "For approximately compounding companies substantiate been more realistic in remission now," he added. Smith is currently aiming to unseat all nine directors of Rube, including Psyche Executive Marissa Mayer.

Lawyers and executives from proxy consultative firms agreed that more proxy contests are creation settled onward getting to a vote. "There are silence near 30 to 40 votes but there are so many more fights" that are over with about concessions, said Bruce Goldfarb, chairman of Okay Partners. Joele Frank, who advises companies on how to battle activist investors, acknowledged that her firm ofttimes urges companies, particularly smaller ones, to radical more quickly , citing the outsize costs of combat. That smell of compromise comes astern approximately bruising activism defeats, including Ackman's scattered bid for Valeant to buy Allergan.

Old Allergan executive Matthew Maletta said, but half bantering, that one weigh his fast powerfulness nascence done differently was to "hug it out with Bill Ackman." The HFRI Termination Driven Competitive Advocate, a heavens benchmark, is spile 4.26 portion for 2015 through Border. It gained just 1.15 percent for 2015 later uprising 6.57 part in 2014. Tribute was crocked at this yr's moment aft protesters decease yr briefly disrupted the outcome in a ask restaurant workers to crystallize a minimum of $15 an bit. (Editing by Leslie Adler)