Anyone in Shareholder Activism Practice? Forum

[curepure]

Saw this article recently (https://www.sharkrepellent.net/request? ... &rnd=39997)

Seems olshan frome wolosky llp and Schulte Roth & Zabel dominated the shareholder activism practice in 2014. I imagine people in this group mostly do public M&A but play with proxy contest as well. Would be wonderful if we have someone here who can shed some lights on the day to day work in this group.

[Anonymous User]

It would be great if anyone in this practice area could shed light on their day to day activities.

[Anonymous User]

Curious about this as well.

[Anonymous User]

I do work in shareholder activism for one of the major players in the space. I wouldn’t recommend it, and it’s a pretty awful practice area IMO. To be clear, there is activist-side shareholder activism (Olshan is big in this) and company-side shareholder activism defense (Wachtell, Gibson Dunn, Sidley), and each side is a little different. I’ve done both. Sorry in advance for any typos, I’m tired and I’m not going to double check this.


The biggest issue with the work is you’re either trying to save someone’s company or take it away from them, so the stakes are very high and every little thing matters. Egos get involved, and people fight to the bitter end, no matter the cost. Lots of mud-slinging and it always gets personal. The deadlines are also killer. For example, there’s always a rush to submit a proxy statement ahead of the other side, so the timelines get very difficult. I’ve been up very late doing this work.


Activism defense is better IMO. The timelines aren’t as rushed, and you’re dealing with a company, not hedge fund people. So the timeline is a little more relaxed, and you’re mostly waiting for the other side, and you don’t have disclosure requirements pop out of nowhere. Even still, expect lots of calls and lots of busy work (charts, checklists, timelines, letters and so on). There’s also a good chance you’re helping the company keep its incompetent management.

With all that said, there is some strategy and PR tactics involved, which can be fun.


Activism on the activist side (“offense?”) SUCKS. The real problem is the PE/hedge funds that do this essentially make their livings off of buying stock in a company, replacing a company’s Board/CEO, cutting costs (employees) to make a short term profit, and then selling their stock. These funds are often filled with managers with big egos at best and awful personalities at worst. Just look up stories about the heads of activist hedge funds (Bill Ackman, Daniel Loeb, Carl Icahn, Paul Hilal and Eddie Lampert). They are pretty soulless people, even for corporate work. They’re also very high strung and demanding.

There are very rigorous disclosure requirements, which are easy to fuck up. So you’ll constantly be asked to prepare documents with insane turn around times. I’ve had companies ask me at 4:00 pm to prepare a 7 page SC 13D due at 5 pm because an analyst messed up and they went over a disclosure percentage.


There’s no exact average day but if I had to make one, it would be this: start working on research (a timeline for the contest, reviewing a standstill provision of every settlement agreement in the past three years and making it into a chart, a checklist for all of the actions, etc.). Likely have a strategy call either before or after lunch for a campaign or two (there are lots of calls). Then I’ll get asked to either prepare a three page letter basically saying the target company’s latest press release is bullshit and the company’s earnings suck. Or even worse, I’ll get a surprise disclosure document. Other days I’ll spend the morning on research and the rest of the night drafting a proxy statement.


Maybe you’d enjoy this if you like the cut-throat parts of business and strategy. But again, you’re either taking or keeping an executive’s job and tarnishing their reputation forever (not to mention firing all “non-essential staff” if the activist wins). It gets VERY ugly. As a result, it tends to attract nasty people and brings out the worst in them. As a junior, you will get strategy experience early. If you’re the type of person that likes to work quietly and by yourself, this isn’t for you. If you don’t like screaming, this isn’t the practice area for you (people tend to scream when their jobs are on the line). There are plenty of activism horror stories out there if you don’t believe me.


I think it takes a cut-throat and ruthless personality to thrive in shareholder activism. It’s sort of like politics, except with other people’s jobs. It isn’t for me, and I don’t think it’s for most people. Beware.


Edit: Here’s a good example of how personal and ugly activism campaigns can get. https://www.cnbc.com/2018/04/23/bill-ac ... s-ceo.html

[Anonymous User]

I have a friend who does defense work and loves it. To each their own I guess. What are exit options for someone with activism experience? Seems pretty niche but being very specialized can sometimes be a good thing.

[Anonymous User]

Agree with the above. Very few associates on the defense side do exclusively shareholder activism, partly because the practice area is viewed as more of a loss-leader for other business (because 1) save a company's ass and they will give you other work in the future and 2) a company's substantive response to shareholder activism often involves activity that requires M&A, ECB, securities, etc. attention).

Insofar as you're getting other corp experience, I think it's great experience to have for someone who wants to eventually be the general counsel of a public company. Activism situations tend to be time-sensitive and high-stakes, and a GC who's done the dance before is an asset. On the other hand, I agree with the above poster who notes that it's one of the more stressful/emotional corners of corporate law.

[Anonymous User]

I have a friend who does defense work and loves it. To each their own I guess. What are exit options for someone with activism experience? Seems pretty niche but being very specialized can sometimes be a good thing.

I think GC is a good one, as it’s mixed with M&A and general corporate work (unless you’re at Olshan or another shop that only does activism).



Defense is generally less demanding than the offensive/activist side. But I still think it has some of the issues I highlighted above. But I’d much rather do defense. There are a lot fewer sleepless nights.

[Anonymous User]

Reviving an old thread. I am a m&a midlevel and very interested in takeover defense work. My firm isn’t a strong player in this area, so I am thinking about lateralling. Which firms should I be looking into if I want to do less m&a and focus on takeover defense?

[Anonymous User]

Reviving an old thread. I am a m&a midlevel and very interested in takeover defense work. My firm isn’t a strong player in this area, so I am thinking about lateralling. Which firms should I be looking into if I want to do less m&a and focus on takeover defense?

You can do activism defense 100% of the time at Sidley. Vinson & Elkins has strong volume too. After that, it’s hard to do takeover or activism defense even 50% of the time but firms like Skadden, Latham, Paul Weiss, Kirkland and Gibson Dunn do the work too. After those firms, I wouldn’t believe any firm that claims to be a player in this area (other than Wachtell of course).

[Anonymous User]

Reviving an old thread. I am a m&a midlevel and very interested in takeover defense work. My firm isn’t a strong player in this area, so I am thinking about lateralling. Which firms should I be looking into if I want to do less m&a and focus on takeover defense?

You can do activism defense 100% of the time at Sidley. Vinson & Elkins has strong volume too. After that, it’s hard to do takeover or activism defense even 50% of the time but firms like Skadden, Latham, Paul Weiss, Kirkland and Gibson Dunn do the work too. After those firms, I wouldn’t believe any firm that claims to be a player in this area (other than Wachtell of course).

I would note that takeover defense is not the same thing as activism defense. Most activism defense doesn't involve a serious takeover threat. Activists often just want board seats, share buybacks, etc.; ESG activism is a big new area and essentially never involves hostile takeovers.

"Pure/traditional" hostile-takeover matters are rare these days and I doubt any lawyer spends even a plurality of their time on it. Maybe a handful of boomer partners scattered among the firms in the above quote. (Chambers bands 1+2 for takeover defense comprise four individual partners; two at WLRK, one at Skadden, and one at Sidley.)

[Anonymous User]

Reviving an old thread. I am a m&a midlevel and very interested in takeover defense work. My firm isn’t a strong player in this area, so I am thinking about lateralling. Which firms should I be looking into if I want to do less m&a and focus on takeover defense?

You can do activism defense 100% of the time at Sidley. Vinson & Elkins has strong volume too. After that, it’s hard to do takeover or activism defense even 50% of the time but firms like Skadden, Latham, Paul Weiss, Kirkland and Gibson Dunn do the work too. After those firms, I wouldn’t believe any firm that claims to be a player in this area (other than Wachtell of course).

I would note that takeover defense is not the same thing as activism defense. Most activism defense doesn't involve a serious takeover threat. Activists often just want board seats, share buybacks, etc.; ESG activism is a big new area and essentially never involves hostile takeovers.

"Pure/traditional" hostile-takeover matters are rare these days and I doubt any lawyer spends even a plurality of their time on it. Maybe a handful of boomer partners scattered among the firms in the above quote. (Chambers bands 1+2 for takeover defense comprise four individual partners; two at WLRK, one at Skadden, and one at Sidley.)

Oh, interesting. In the end, it’s still the same firms right? Sidley, Skadden and Wachtell?

Also, would you say takeover defense is a dying area?

[Anonymous User]

Other anon is right that takeover defense is even rarer work than activism defense, but they’re often handled by the same folks at a firm. I know a few people who do takeover defense 25-50% of the time, but there aren’t that many unsolicited offers and of those that there are, many aren’t backed by a credible proxy contest or other pressure tactics (there’s been an uptick the last 18 months, though). For true takeover defense, its Wachtell and Skadden followed by the other firms mentioned above (Sidley, Kirkland, Paul Weiss, etc.). A lot of M&A partners will just handle hostile takeovers themselves, which may not be the best idea…

[Anonymous User]

Other anon is right that takeover defense is even rarer work than activism defense, but they’re often handled by the same folks at a firm. I know a few people who do takeover defense 25-50% of the time, but there aren’t that many unsolicited offers and of those that there are, many aren’t backed by a credible proxy contest or other pressure tactics (there’s been an uptick the last 18 months, though). For true takeover defense, its Wachtell and Skadden followed by the other firms mentioned above (Sidley, Kirkland, Paul Weiss, etc.). A lot of M&A partners will just handle hostile takeovers themselves, which may not be the best idea…

So…as a mid-level, it’s quite unlikely that I will be involved in the true takeover defense even if I were to lateral to Wachtell/Skadden?

[Definitely Not North]

Reviving an old thread. I am a m&a midlevel and very interested in takeover defense work. My firm isn’t a strong player in this area, so I am thinking about lateralling. Which firms should I be looking into if I want to do less m&a and focus on takeover defense?

yeah the last few episodes of Succession were pretty great

[Anonymous User]

Other anon is right that takeover defense is even rarer work than activism defense, but they’re often handled by the same folks at a firm. I know a few people who do takeover defense 25-50% of the time, but there aren’t that many unsolicited offers and of those that there are, many aren’t backed by a credible proxy contest or other pressure tactics (there’s been an uptick the last 18 months, though). For true takeover defense, its Wachtell and Skadden followed by the other firms mentioned above (Sidley, Kirkland, Paul Weiss, etc.). A lot of M&A partners will just handle hostile takeovers themselves, which may not be the best idea…

So…as a mid-level, it’s quite unlikely that I will be involved in the true takeover defense even if I were to lateral to Wachtell/Skadden?

I mean you can be and will be if you join an activism defense team. But unsolicited takeovers are usually like 10% of the overall activism volume. It’s more making decks analyzing governance and creating other minor work products, preparing proxy statements and proxy filings, lots of marking up press releases and letters and sitting on tons of strategy calls. The board meetings are interesting but otherwise responding to unsolicited takeovers is kind of just stressful and formulaic.

[Anonymous User]

Reviving an old thread. I am a m&a midlevel and very interested in takeover defense work. My firm isn’t a strong player in this area, so I am thinking about lateralling. Which firms should I be looking into if I want to do less m&a and focus on takeover defense?

yeah the last few episodes of Succession were pretty great

Eh, it's been kind of slow IMO. I have high hopes for Kendall's birthday though

[Anonymous User]

Other anon is right that takeover defense is even rarer work than activism defense, but they’re often handled by the same folks at a firm. I know a few people who do takeover defense 25-50% of the time, but there aren’t that many unsolicited offers and of those that there are, many aren’t backed by a credible proxy contest or other pressure tactics (there’s been an uptick the last 18 months, though). For true takeover defense, its Wachtell and Skadden followed by the other firms mentioned above (Sidley, Kirkland, Paul Weiss, etc.). A lot of M&A partners will just handle hostile takeovers themselves, which may not be the best idea…

So…as a mid-level, it’s quite unlikely that I will be involved in the true takeover defense even if I were to lateral to Wachtell/Skadden?

I mean you can be and will be if you join an activism defense team. But unsolicited takeovers are usually like 10% of the overall activism volume. It’s more making decks analyzing governance and creating other minor work products, preparing proxy statements and proxy filings, lots of marking up press releases and letters and sitting on tons of strategy calls. The board meetings are interesting but otherwise responding to unsolicited takeovers is kind of just stressful and formulaic.

Agree. Can't really lateral to WLRK as a midlevel so basically the path would be:

- Lateral to Skadden/Sidley
- Attach yourself to the lone partner at each (check Chambers) with a strong takeover-defense workstream
- Hostile-takeover matters will come by every so often; make it clear you want to get staffed on those
- Bill another 1700-2000 hours a year on non-takeover activism defense and/or M&A in order to justify your midlevel salary

All of this is easier said than done, but the last point IMO is the main problem with "pivoting to takeover defense" as a medium-term goal

[Anonymous User]

FWIW activist defense is part of general Corporate practice at WLRK. start doing it as a first year along with your traditional M&A (and occasional capital markets) work. true at partnership level as well, w/really only one exception I can think of

[Anonymous User]

FWIW activist defense is part of general Corporate practice at WLRK. start doing it as a first year along with your traditional M&A (and occasional capital markets) work. true at partnership level as well, w/really only one exception I can think of

Does Wachtell hire laterals? I am still a junior and went to a lower t14 if that matters.

[Sackboy]

FWIW activist defense is part of general Corporate practice at WLRK. start doing it as a first year along with your traditional M&A (and occasional capital markets) work. true at partnership level as well, w/really only one exception I can think of

Does Wachtell hire laterals? I am still a junior and went to a lower t14 if that matters.

Yes in areas like tax and exec comp. Rarely ever in corporate, and it's all moot anyway unless you were coif+LR at your T14 and are already practicing at a V5/10.

[Anonymous User]

FWIW activist defense is part of general Corporate practice at WLRK. start doing it as a first year along with your traditional M&A (and occasional capital markets) work. true at partnership level as well, w/really only one exception I can think of

Does Wachtell hire laterals? I am still a junior and went to a lower t14 if that matters.

Yes in areas like tax and exec comp. Rarely ever in corporate, and it's all moot anyway unless you were coif+LR at your T14 and are already practicing at a V5/10.

this is basically correct. putting aside credentials, also moot for most due to Firm-candidate ... lifestyle ... incompatibility lol

[Anonymous User]

FWIW activist defense is part of general Corporate practice at WLRK. start doing it as a first year along with your traditional M&A (and occasional capital markets) work. true at partnership level as well, w/really only one exception I can think of

Does Wachtell hire laterals? I am still a junior and went to a lower t14 if that matters.

Yes in areas like tax and exec comp. Rarely ever in corporate, and it's all moot anyway unless you were coif+LR at your T14 and are already practicing at a V5/10.

Wachtell hired at least 4 or 5 general corporate people this calendar year (S&C, Skadden, CSM, DPW), but that's probably because there's just so much M&A work to go around. Agreed that laterals in most years are in the specialized groups - and more ECB than tax, I think.

[Anonymous User]

FWIW activist defense is part of general Corporate practice at WLRK. start doing it as a first year along with your traditional M&A (and occasional capital markets) work. true at partnership level as well, w/really only one exception I can think of

Does Wachtell hire laterals? I am still a junior and went to a lower t14 if that matters.

Yes in areas like tax and exec comp. Rarely ever in corporate, and it's all moot anyway unless you were coif+LR at your T14 and are already practicing at a V5/10.

Wachtell hired at least 4 or 5 general corporate people this calendar year (S&C, Skadden, CSM, DPW), but that's probably because there's just so much M&A work to go around. Agreed that laterals in most years are in the specialized groups - and more ECB than tax, I think.

we had a few lit laterals this year too, which is sorta unheard of. think it's a general COVID busy-ness/desperation thing

[Anonymous User]

Wachtell hired at least 4 or 5 general corporate people this calendar year (S&C, Skadden, CSM, DPW), but that's probably because there's just so much M&A work to go around. Agreed that laterals in most years are in the specialized groups - and more ECB than tax, I think.

we had a few lit laterals this year too, which is sorta unheard of. think it's a general COVID busy-ness/desperation thing

At least one associate changed from corp to lit, which is also in the "probably only possible in a COVID-type environment" category