Shareholder Activism Growing Aggressively

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    Investors need to care about shareholder activism because the chances are at some point you will be impacted, says Chris Young, managing director and head of contested situations at Credit Suisse. Speaking at the CFA Society Toronto’s ‘Annual Forecast Dinner,’ he said it is a discrete asset class and money is pouring into it. However, the level of aggression is growing with activist investors forcing the break-up of companies and taking over boards. The concern is that companies taken over by activist investors will sacrifice long-term growth to satisfy the short-term demands of the activists. At this time, the level of activism is lower in Canada with about 10 proxy fights each year compared to 400 in the U.S. However, he said this will likely grow going forward with activists targeting larger companies.