Activist Investing Today: White & Case’s Matthews, Tolani on Insurgents, Deals

White & Case partners Tom Matthews and Sonica Tolani speak with Activist Investing Today host Ronald Orol and explain why they are seeing a trend of insurgent managers partnering with private equity to try to buy companies they previously targeted with agitation campaigns.

Commenting on the shareholder activism work White & Case advises on Matthews said: "Here in London, many of the UK campaigns we work on involve overseas activists, mainly from the US, and we're lucky to work with many of the leading US funds. Similarly, our European colleagues, for example in France and Germany, regularly work on campaigns where the agitating investor is foreign rather than domestic. 

One unique aspect of our practice is that we regularly act for both activists and public companies. We see this as a real strength as it enables us to give clients valuable tactical and strategic insights on activist strategies and corporate responses, insights which aren't available to advisers who only ever act on one side of the divide,” said Matthews. 

Explaining the effect of the strength of the US dollar on cross-border bumpitrage and activism Tolani commented: "UK plcs continue to trade at a discount to their international peers and so it is to be expected that they will continue to attract interest from international investors… This is in part due to the weakness of the sterling compared to the strength of the US dollar, which has been a safe harbour to many during the recent economic turbulence, but there is also a fundamental undervaluation of UK public equities. So the key deal dynamics are there and delivering real value opportunities to overseas investors, particularly from the US, and we continue to receive a significant number of inbound calls from US investors interested in UK equities. 

Of course this is fertile ground for activist investors, whether they are agitating for strategic change, a change in approach to capital allocations or for an M&A solution. Wherever there is a fundamental disconnect between market valuation and underlying value there are opportunities for activists,” Tolani added. 

The interview can be listened to on The Deal, Apple Podcasts and Spotify.

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