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Activist investors take on Anaplan & the cloud

Written by Tue 29 Mar 2022

Activist investors, especially in the technology sector, were very active last year. According to data from CNBC, a total of 89 campaigns were waged last year by activist shareholders. These hedge funds have different goals in mind when attempting to improve the situation for shareholders, as well as owning different levels of company stock when attempting to do so.

Two activist hedge funds recently invested in cloud software firm, Anaplan, and announced they would be nominating new board members at the firm. Soon after these activist investors targeted Anaplan, the enterprise software firm was sold in a $10.7 billion deal to Thoma Bravo, a private equity firm. Thoma Bravo have signalled that they expect to keep the management of Anaplan the same. The $66 per share sale price is a 30% premium on a recent closing price.

It is becoming increasingly common for billionaire investors and hedge funds to build up large stakes in businesses and then drive forward with disruptive strategies at those companies. Technology firms have been one of the sectors that activity investors have targeted in recent years.

For example, Elliott Management is backed by US billionaire Paul Singer and has gained a reputation for restructuring businesses that they invest in and often attempt to replace the leadership. Perhaps the most high-profile example of Elliott Management investing in a technology company and then pushing for changes is the $1 billion investment, or 4% stake, the firm built up in Twitter.

Once this funding has been completed, the firm pushed for the removal of CEO Jack Dorsey in a bid to improve the social media platform’s financial performance. In 2020, it was also announced that Elliott Management had established a 3% stake in Japanese company SoftBank and intended to get the company to change it’s board, increase transparency and do a stock buy-back.

Written by Tue 29 Mar 2022


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