Activist investors are leading calls for strategic changes in US corporations

From Yahoo Finance: 2025-04-21 13:16:00

In 2025, economic uncertainty and market volatility have fueled a 17% increase in activist investor campaigns, with the US leading the charge. Activists are pushing for strategic changes to unlock shareholder value amid instability caused by tariffs, layoffs, and recessionary fears.

Activists focus on board changes, winning 51 board seats in the first quarter of 2025. They also advocate for strategic and operational changes, with 26% pushing for merger and acquisition activities, a significant drop from the historical average of 45%.

Despite a decrease in shareholder proposals related to environmental, social, and governance issues, conflicts persist. Activists are cautious due to concerns about investor support and regulatory approval, leading companies to make changes to avoid public battles.

Newly founded hedge funds are turning to activism to navigate difficult times, with 11 first-timers launching campaigns in the first quarter of 2025. Barclays anticipates continued focus on US corporations and increased shareholder demands for the remainder of the year.

Ancora Holdings’ $1 billion stake in United States Steel Corporation (X) has sparked an activist campaign for management changes. The hedge fund aims to replace the board, install a new CEO, and implement a turnaround plan that could deliver over $75 per share if a proposed takeover falls through.

Ancora Holdings also calls for investment in revitalizing plants and a new blast furnace facility, urging US Steel to divest non-union assets. While X ranks 9th on the activist campaign list, potential investors may find greater promise in AI stocks for higher returns in a shorter timeframe.



Read more at Yahoo Finance: Among Recent Activist Investor Campaigns