Is Canada an Activist Investor’s Paradise?

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Jan. 27 (Bloomberg) –- Crescendo Partners Chairman & CEO Eric Rosenfeld and Bloomberg’s Su Keenan discuss investing in Canada vs. the United States with Deirdre Bolton on Bloomberg Television’s “Money Moves.” (Source: Bloomberg)

Really stuck out for you?

One of these inks that is interesting is that you are a very high-profile activist, and you are one of the most low-profile, and due to this you -- and part of this is that you do deals in canada.

But we have also called it the activist paradise.

One of the biggest differences is that if you own five percent of the canadian company, you can requisition a shareholder meeting.

That gives the shareholders and the activist tremendous power.

If you are under the radar, you do not have to report your stake.

Correct, it is a five percent stake here, 10% in canada.

We have attempted to do -- get on 222 companies, and we've gotten onto the boards thereof -- tononto 22 companies, and we've gotten onto those boards, . a lot of what you have been working on is tech companies, why is this so bright for investors to unlock all you -- c value?

We have invested in tech, but also retail, and defense companies.

There has in a lot of undervalued companies, so we have targeted those.

It is interesting to point out that you say there are no homegrown activists in canada.

You say they are too nice to play this game.

Canadians are very nice, so most of the activism has been americans going up there.

There is a structural difference, and technicalities that allow you to navigate quicker and easier, right?


30 years ago would poison pill first round and in the united states, the idea was to give the company a little more time in the boards to explore alternatives.

You could have 95% of the shareholders went to -- wanting to accept an offer, but the board could say no and you would have proxy fights.

In canada, they can issue a cease trade order.

The view is that the shareholder should decide what happens with the company, were with the u.s. led the deal is that the board should decide.

What else looks good, and is on your radar for this year?

One of the companies that we are involved with right now is area postal -- arial posteopostale.

It is doing terrible, and is down.

We think that the company should be sold, they are going to return around just going through a turnaround -- they are going through a turnaround.

We know that private equity often looks to real estate targets as part of the education with the hope and a private equity firm will approach you and say that i realize this company could be run better, let's make a deal.

We think the company should be sold, and the likely buyers would be pe firms or another retailer.

You went to activists saying sell yourself, or be taken private.

Does that public it thinks that obligate things -- complicate things?

What we said was that we intend to nominate directors, and unless the company sold before that week intend to follow through -- and unless the company sold before that, we intend ball through.

-- to follow through.

This is indicative of what we see as a new rise in the act activism -- andy activism machine --anti-activism machine.

If a shareholder did not like where it was going in the company, they would sell their stock.

What they have learned is that if you do not like what is going on in the company, you can effectuate changes.

You can get an activist to help you . -- you.

What about somebody like carl icahn who takes the position, and then tweets about it?

It is certainly much higher profile than we are.

When he does that, the stocks tend to go out.

A whole industry has developed to fight the activists command the activist have become more active, and more companies go out and look to see what do we need to do now?

How crowded is the field getting?

We have talked about more hedge funds that of jumped into this game, 17% increase.

There are so many undervalued companies and under performing companies that we never find problems with finding targets.

It when we do, it is probably more likely that that company is going to succumb to what the activists want and agree to make changes.

It is not a bad thing when it does happen.

"bloomberg west thank you.

When we come back, more on this

This text has been automatically generated. It may not be 100% accurate.


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