Welcome to the March edition of In the Know, Baker McKenzie's Leveraged Finance newsletter, which analyses significant trends and salient legal issues for participants in leveraged finance and high-yield markets in Europe and around the globe.
Global activism was especially pronounced in 2024, reaching its highest level since 2018. Activists generally focused on the industrials and technology sectors, while a third of campaigns targeted mega-cap companies. More than a quarter of global activist campaigns launched in 2024 related to environmental, social or governance issues, with a majority focussing on corporate governance. This surge in activist activity reflects emboldened activists, with more campaigns reaching the public domain and an ever-growing need for a company's board to clearly articulate its strategy to shareholders and wider stakeholders, including major creditors. Alongside the growth in equity activism, we also see evolving activist activity on the debt-holder side, with a number of high-profile debt activist stories which have carried into 2025.
This instalment of In the Know will reflect on the debt considerations arising from equity activism, look at recent debt-holder activism, and conclude by contemplating future developments with the two styles of activism.
Samuel Trevor, Trainee Solicitor, has contributed to this legal update.