“To our understanding, hedge fund activism stands for minority investments in undervalued or poorly managed public companies by one or several investors, investment partnerships or activist funds based on strategic objectives and tactical measures carefully formulated in advance”
Guzov, LLC’s Ami de Chapeaurouge’s new paper, published in the Hong Kong Lawyer in both English and Chinese, examines shareholder activists’ demands and hedge fund activism in Hong Kong and Germany. De Chapeaurouge tackles empirical studies to illustrate the commonalities and dissimilarities between Hong Kong with China and Germany with Europe, and examines the behavior of shareholders and controllers in blockholder-influenced companies.
Germany and Hong Kong have strong and powerful economies, but are in need of greater shareholder and hedge fund activism, particularly in these controlled companies. A controlling shareholder justifies their superior position with their business skills, however, many of these controllers are handed their position through nepotism. Activists aim to enhance company value, monitor governance, and improve company efficiency, which is imperative for a healthy, competitive free market.
De Chapeaurouge’s analysis demonstrates the similarities between the two jurisdictions’ corporate cultures, which leads to similar shareholder activist tactics and behavior in Hong Kong and Germany. Read his new published article to gain a greater understanding of shareholder and hedge fund activism in these countries compared to the U.S. and U.K. Access the article here.
This article is Part I of three installments. The next installment will be published in July.
Guzov, LLC’s Ami de Chapeaurouge’s new paper examines shareholder and hedge fund activism in Germany and its impact on corporate governance and corporate law. In the past 15 years there have been 400 equity activist campaigns targeting 200 out of Germany’s 650 listed companies. This is an important shift from “the threat of hostile takeovers” to correct inadequate shareholder management. In his analysis, de Chapeaurouge compares the rights of minority shareholders in Germany and the United States, concluding that German minority shareholders have “well-developed and strong” rights. To understand more about the importance of shareholder and hedge fund activism, read de Chapeaurouge’s article here.
Guzov, LLC successfully facilitated a cooperative shareholder’s right to review the books and records of his co-op. Justice Lebovits granted Guzov, LLC’s Article 78 petition to view corporate records demonstrating that a shareholder in a co-op has the same legal rights to documents as shareholders in other public and closely-held corporations doing business in the State of New York. In ruling as it did, the Court confirmed the intrinsic right of shareholders to protect their investments.
View the Court’s decision here.