article thumbnail

How Employees Respond When Activist Investors Get Involved

The Horizons Tracker

Institutional investors, such as hedge funds, are increasingly active in terms of their attempt to influence the direction of the firms they invest in. The authors argue that this loss of talent is largely because of the uncertainty caused by the hedge funds activity.

Hedge 127
article thumbnail

GM’s Stock Buyback Is Bad for America and the Company

Harvard Business Review

” But the only real wins are a victory for the hedge funds, and a Pyrrhic victory for GM in that it managed to keep Wilson off its board and reduced the size of the buyback from the $8 billion the investors had been demanding. During the bailout, financial firms, including hedge funds, were nowhere to be found. Instead, U.S.

Hedge 8
Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

Yes, Short-Termism Really Is a Problem

Harvard Business Review

” On the other side, noted economist and hedge fund adviser Larry Summers cautions that reforming “quarterly capitalism” would risk driving us toward “Japan’s keiretsu system, which insulated corporate management from share price pressure by tying large companies together.” Either explanation is plausible.

Hedge 8
article thumbnail

Startups Could Fundamentally Change the Way Big Investors Operate

Harvard Business Review

Large investors rely on an assortment of intermediaries to help them with their investment activities, including asset managers, such as hedge funds, investment banks, and consultants. An influx of that scale would dwarf the approximately $78 billion invested in startups by venture capitalists in 2015.

article thumbnail

GE’s Fall Has Been Accelerated by Two Problems. Most Other Big Companies Face Them, Too.

Harvard Business Review

GE’s fall accelerated on October 25, 2015, with activist hedge fund Trian announcing a $2.5 billion equity investment in GE stock, one that made it a top 10 shareholder. GE stock was trading at $25.47 at the time of announcement, with a dividend of $0.92 per share.

TSR 9
article thumbnail

?Numbers Show Apple Shareholders Have Already Gotten Plenty

Harvard Business Review

9, armed with about 1% of Apple’s outstanding stock, the hedge-fund activist published an open letter to Apple CEO Tim Cook, urging him to accelerate the company’s stock repurchases by making a tender offer. Another hedge-fund activist, David Einhorn, was then playing that role). Carl Icahn is at it again.

article thumbnail

Oil’s Boom-and-Bust Cycle May Be Over. Here’s Why

Harvard Business Review

.—while still a net importer of oil—is now selling millions of barrels of oil to China, Britain, Mexico, and India, a new reality made possible when restrictions on crude oil exports were lifted in 2015. Most major producers with large balance sheets will likely hedge their bets and attempt both. The soaring U.S.