14 janvier 2015

The Threat to Shareholders and the Economy from Activist Hedge Funds

Martin Lipton | The Harvard Law School Forum

“ A paper by Dr. Yvan Allaire entitled “The Value of ‘Just Say No,’” and also memos by our firm (here and here, the latter memo discussed on the Forum here), demonstrated that an ISS client note entitled “The IRR of No,” which argued that companies that had “just said no” to hostile takeover bids incurred profoundly negative returns, suffered from critical methodological and analytical flaws that undermined its conclusions.

Dr. Allaire also presented a sophisticated analysis contained in two papers (“Activist Hedge Funds: Creators of Lasting Wealth? What Do the Empirical Studies Really Say?” and “Hedge Fund Activism and Their Long-Term Consequences; Unanswered Questions to Bebchuk, Brav and Jiang”), consistent with our firm’s earlier observations (discussed on the Forum here), offering a devastating critique of Professor Bebchuk’s research claiming to show that attacks by activist hedge funds did not destroy long-term value.” Lire la suite