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Institutional Investor Activism: Hedge Funds and Private Equity, Economics and Regulation (eBook)

Edited by: William Bratton, Joseph A. McCahery

ISBN13: 9780191039799
Published: August 2015
Publisher: Oxford University Press
Country of Publication: UK
Format: eBook (ePub)
Price: £41.24
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The past two decades has witnessed unprecedented changes in the corporate governance landscape in Europe, the US and Asia. Across many countries, activist investors have pursued engagements with management of target companies.

More recently, the role of the hostile activist shareholder has been taken up by a set of hedge funds. Hedge fund activism is characterized by mergers and corporate restructuring, replacement of management and board members, proxy voting, and lobbying of management.

These investors target and research companies, take large positions in 'their stock, criticize their business plans and governance practices, and confront their managers, demanding action enhancing shareholder value.

This book analyses the impact of activists on the companies that they invest, the effects on shareholders and on activists funds themselves. Chapters examine such topic as investors' strategic approaches, the financial returns they produce, and the regulatory frameworks within which they operate. The chapters also provide historical context, both of activist investment and institutional shareholder passivity.

The volume facilitates a comparison between the US and the EU, juxtaposing not only regulatory patterns but investment styles.

Subjects:
Banking and Finance, eBooks, Law and Economics
Contents:
1. Introduction

PART I. THE DISEMPOWERED SHAREHOLDER
2. The Evolution of Shareholder Activism in the United States
3. The Myth of the Shareholder Franchise
4. Shareholder Activism through Proxy Proposals: The European Perspective

PART II. HEDGE FUND ACTIVISM

A. PATTERNS AND POLICY QUESTIONS - DARK SIDES AND LIGHT SIDES
5. Hedge Funds in Corporate Governance and Corporate Control
6. The Rise and Fall (?) of Shareholder Activism by Hedge Funds

B. OWNERSHIP STAKES, OPERATING RESULTS, AND FINANCIAL RETURNS
7. Returns to Shareholder Activism: Evidence from a Clinical Study of the Hermes Focus Fund
8. Hedge Fund Activism, Corporate Governance and Corporate Performance
9. Entrepreneurial Shareholder Activism: Hedge Funds and Other Private Investors

C. STRATEGIC HOLDING VERSUS COLLECTIVE INTEREST: EMPTY VOTING AND BANKRUPTCY REORGANIZATION
10. Debt, Equity and Hybrid Decoupling: Corporate Governance and Systemic risk Implications
11. Common Pools, Common Disasters and the Anti-Commons: Hedge Fund Activity in Corporate Reorganizations
12. Hedge Funds and Chapter 11

PART III. PRIVATE EQUITY AND CORPORATE GOVERNANCE

A. STRUCTURE AND MOTIVATION
13. Leveraged Buyouts and Private Equity

B. HOW HAS PRIVATE EQUITY PERFORMED?
14. Performance of Buyout Funds Revisited

PART IV. THE REGULATORY FRAMEWORK

A. STRUCTURAL TREATMENT OF HEDGE FUNDS AND PRIVATE EQUITY: INVESTOR PROTECTION AND SYSTEMIC RISK
15. Hedge Fund Regulation and Governance
16. The Limits of EU Hedge Fund Regulation
17. Recasting Private Equity Funds after the Financial Crisis: The End of 'Two and Twenty' and the Emergence of Co-Investment and Separate Account Arrangements

B. REGULATION AND THE COSTS AND BENEFITS OF SHAREHOLDER ACTIVISM
18. The Law and Economics of Blockholder Disclosure
19. The Destructive Ambiguity of Federal Proxy Access

C. LAW REFORM: THE BURDEN OF PERSUASION
20. The Case Against Shareholder Empowerment