In Germany, A Hedge Fund Stands Up for Shareholder Rights
Davidson Kempner’s challenge to a landlord mega-merger may not change much. But it’ll have implications for future takeovers.
Wrong move.
Photographer: SOPA Images/LightRocketThe shareholder activist’s art is to combine financial self-interest with the moral high ground. Take the recent attack by Davidson Kempner European Partners LLP on German landlord Deutsche Wohnen SE. This is surely an attempt to get better terms from Vonovia SE in its 19 billion-euro ($22 billion) bid for its peer. But the hedge fund is also defending an important point of principle.
Davidson Kempner is angry that Deutsche Wohnen agreed to sell shares to Vonovia in two takeover bids for the firm this year. The criticism is justified. The moves could have helped Vonovia gain control even if a majority of Deutsche Wohnen shareholders opposed it. Deciding whether to accept a bid should be for shareholders alone.