Shareholder activism kept lawyers at Vinson & Elkins LLP busy in 2019, topping a ranking of legal advisers by the number of companies it helped defend.
Wachtell, Lipton, Rosen & Katz led corporate legal defense when ranked by the value of activist stakes, with a total of $12.9 billion, Bloomberg data show.
Also topping the list was Sidley Austin LLP, which has been building up its activist defense team lately. Sidley advised AT&T Inc., the biggest company targeted by an activist last year, in a face-off with hedge fund Elliott Management Corp. that ended in a truce.
“2019 was the busiest year our shareholder activism defense practice has ever had,” said Lawrence Elbaum, co-head of the practice at Vinson & Elkins.
The Houston-headquartered firm, known for its energy-related work, has ramped up its activism advising in recent years. It was the legal adviser for activist campaigns at 27 companies in 2019, including Anadarko Petroleum Corp.
Vinson & Elkins’ activism work covers both public battles and behind-the-scenes maneuvering as companies and investors try new ways to avoid drawn-out fights.
Activists launched 518 new campaigns in 2019, with stakes worth a collective $76 billion, according to Bloomberg data. That’s up slightly from 512 campaigns also worth $76 billion the prior year.
Another trend for the year was activism around corporate dealmaking designed to thwart sales. Activists have traditionally pushed companies to seek a sale.
“That still happened in 2019,” said Ryan Nebel, a partner at Olshan Frome Wolosky LLP. Olshan topped Bloomberg’s ranking of legal advisers to activist investors. “But we saw a lot of kill-the-deal type activism, too,” Nebel said.
One of the most high-profile examples was Carl Icahn’s campaign against Occidental Petroleum Corp.'s recent takeover of Anadarko.
Companies had clear victories about 42% of the time in 2019, up from 33% in 2018, according to the data.
The difference was driven by activist investors withdrawing more often, the data show. Activist Starboard Value called off its fight to block Bristol-Myers Squibb Co.'s takeover of Celgene Corp. after two top shareholder advisory firms recommended that investors support the deal.
“Last year was the best year for boards in recent history,” said Kai Liekefett, who chairs Sidley’s shareholder activism practice. Liekefett joined Sidley from Vinson & Elkins in 2018.