Although Akzo has rejected Elliott’s efforts on that front, the investor has not relented in its call for the company to reconsider PPG’s bid. On Friday, Elliott asserted that Akzo’s plan to go it alone would result in more layoffs than if it accepted PPG’s €24.6 billion offer.
The increasing prominence of activist investors—historically, an American phenomenon—has started to define more of Europe's dealmaking in the last year. Toscafund, for example, increased its stake in Ireland’s San Leon Energy to 56% in February, having previously encouraged the company to engage in takeover talks with Geron Energy. Meanwhile, Cevian Capital increased its stake in industrial services business Bilfinger to 29.5% in March, having helped to instigate a reshuffle of the company’s board as well as the sale of its real estate unit in 2016.
A pair of factors is fueling the recent rise of activist investors. The slump in European stock markets in 2016 afforded investors the opportunity to build powerful positions in undervalued equities. On top of this trend, European M&A deal values hit a historically high level last year, per the PitchBook Platform. With cash-rich PEs and strategic buyers looking to deploy capital, activists have urged potential acquisition targets to carve out stakes for a shot at a merger premium.
For activists, it certainly beats waiting for organic growth to develop. As investor Guy Wyser-Pratte said after revealing his stake in takeover target Stada: “Why wait five years instead of selling in five months?”