Activist Investors Shake Up American Companies
Friday, April 12, 2013
Some of the most well-known companies in corporate America have recently landed at the center of some pretty rough and tumble fights between their board of directors and activist investors.
This week on Money Talking, Rana Foroohar of Time magazine and Steve Bertoni of Forbes magazine discuss why there appears to be a sudden surge in shareholder activism and what it means for the company, the investors and the economy.
These investors, people like Carl Icahn, David Einhorn and Daniel Loeb, have been challenging businesses like Apple, Dell and Yahoo on issues ranging from how the companies spend their cash reserves to how much they are worth.
These kinds of shareholders may not have a seat on the board of directors, but they purchase a large enough amount of stock in order to push for major changes in the company.
In March, shareholder opposition to the $24.4 billion buyout of Dell by its CEO, Michael Dell, ramped up when Icahn joined the fight and made his own bid to buy out the company.
Einhorn, a hedge fund manager and president of Greenlight Capital, criticized Apple for holding on to too much cash and pressured the company to issue new stock. Apple CEO Tim Cook is now reportedly considering what to do with the company’s surplus.