British public companies face mounting pressure from aggressive US activist investors as depressed valuations make FTSE-listed firms increasingly attractive targets. A comprehensive report by management consultancy Alvarez and Marsal (A&M) reveals that activist funds launched 59 campaigns against UK listed companies last year, positioning Britain as Europe’s prime target and the world’s fourth most contested market.
The scale of activist intervention in British markets significantly overshadows other European nations, with German companies facing 38 campaigns, Swiss firms confronting 19, and French businesses dealing with just 12 activist approaches. Most notably, US-based funds are leading 40% of these campaigns, marking a five-year high in American activist involvement.
André Medeiros, co-head of European consumer and retail at A&M, points to the stark valuation gap between US and UK companies as the primary driver of this trend. “US activists are increasingly turning to Europe, and particularly the UK, to find value. British corporates continue to underperform against their global peers, reflected in significant discounts on UK equities,” he explained.
The past year witnessed several high-profile interventions. Elliott Investment Management built a billion-pound stake in Anglo American during BHP’s takeover attempt. Nelson Peltz’s Trian Partners secured a top-ten shareholding in Rentokil, whilst consumer giant Reckitt Benckiser found itself targeted by both Causeway Capital Management and Eminence Capital.
Paul Kinrade, a senior adviser at A&M, highlighted the distinctly aggressive approach of US funds compared to their European counterparts, noting that “Activist funds in Europe are far less likely to reach for public activism than US funds.” This cultural difference in approach adds another layer of complexity for British firms facing American activist intervention.
The trend has extended beyond traditional blue-chip targets, with iconic British brands such as Dr Martens, investment manager Baillie Gifford, and chemicals specialist Johnson Matthey all experiencing activist pressure. This widespread activist attention signals a potentially transformative period for British corporate governance and ownership structures.
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