“Sidley Austin Leads Big Law Defense Against Investor Activists” – Bloomberg Law

Bloomberg Law's Clara Hudson?and Andrew Ramonas?write about the league tables for legal shareholder activism advice in 2023. An excerpt from the article is below and the full article is here.

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Jan. 5, 2024

Sidley Austin Leads Big Law Defense Against Investor Activists

• Sidley Austin helped fight 48 activist campaigns in 2023
• On the activist side, Olshan led in taking on 139 campaigns

Sidley Austin LLP is once again in the top spot as the firm that helped the most public companies weather shareholder activism matters over the past?record-breaking?year.

Sidley advised companies on 48 engagements in 2023 with total shareholder stakes in the firm’s matters valued at $7.3 billion, according to?new Bloomberg data. The figure represents the value of shares owned by activist investors involved in campaigns. The firm also?secured the lead?in 2022 after battling 48 activist campaigns.

There were 823 new activist campaigns launched in 2023, a 24% jump from 665 campaigns in 2022.

Sidley advised biopharmaceutical company?Alkermes?in a proxy contest against Sarissa Capital that made headlines last year when the Sarissa head nominated his romantic partner to fill his space at?Biogen Inc.?after he left his seat to pursue three director seats at Alkermes. Alkermes beat back Sarissa Capital’s efforts to secure director seats at the company’s annual meeting in late June.

Sidley took on another matter at department store chain?Nordstrom Inc.?where activist investor Ryan Cohen, the chairman of?GameStop Corp.?and founder of online pet supplies retailer?Chewy Inc., nominated two board candidates before ultimately withdrawing.

Kai Liekefett, a Sidley partner who co-chairs the firm’s shareholder activism and corporate defense practice, said that overall activist activity “was enormous” in recent months. “It was one of the biggest years for activism in recent history,” he said.

Market uncertainty and volatility—spanning everything from inflation to supply chain issues—hampered what would have been even more activist matters, Liekefett said. But as some of the uncertainty dies down, he anticipates another surge this year. “I fully expect an extraordinarily busy proxy season,” he said.

Defending Activists

Olshan Frome Wolosky LLP continued to lead as the top firm representing activists in 2023, with 139 engagements covering shareholder stakes valued at $15.6 billion, according to Bloomberg data. Last year the firm had 147 engagements with stakes valued at $19.4 billion.

Olshan advised Elliott Investment Management this year on its campaign at?Salesforce Inc., ending in a March agreement where Elliott decided not to further pursue its director nominations. A joint press release said Elliott dropped its efforts in light of the company’s financial results and other factors.

Olshan also worked on a campaign by Anson Funds and Cable Car Capital at MEI Pharma, a pharmaceutical company that develops cancer therapies. The activists entered a cooperation agreement with MEI Pharma in October in which the company agreed to appoint two directors selected by Anson and Cable Car as well as another director who was mutually agreed upon.

Meagan Reda, a partner at Olshan focusing on shareholder activism and proxy contests, said new universal proxy card rules made proxy contest costs “substantially increase” last year despite the misconception by many that the rules would actually make them cheaper. The new universal proxy rules, which became effective in September 2022, changed the way corporate elections are run by requiring all nominated director candidates to appear on a single ballot.

Reda said some companies last year used the guise of needing to amend their bylaws to reflect the new rules so they could “adopt extremely egregious, unreasonable and onerous bylaw amendments, making it substantially more difficult, time-consuming, and costly to run a proxy contest.”

The bylaw amendments “will continue to impact the 2024 proxy season and beyond,” Reda said.

To contact the reporters on this story: Clara Hudson in Washington at [email protected]; Andrew Ramonas in Washington at [email protected]