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Saturday, March 28, 2020

Canadian Hedges wage public battles against ill-conceived acquisitions, lacklustre directors


Date: Friday, October 22, 2004


According to canada.com (The Financial Post) it used to be that stodgy pension funds and oddball gadflies were the only ones prodding Canadian companies to respect shareholder rights. Now, more hedge funds and other opportunistic money managers are getting tough with bungling companies and their boards, and it's about time. There's plenty of opportunity for aggressive asset managers to agitate for change, especially among smaller companies that often fly under the radar of the major pension funds and large institutional investors, many of which belong to the Canadian Coalition for Good Governance. This established, relatively serene group of governance advocates prefers to quietly and politely cajole companies into changing their ways for the sake of shareholders and the greater good. This method often works beautifully, but it can be slow. So following the example of the U.S., Canada is seeing more cases of emboldened hedge funds and other money managers, armed with increasing amounts of capital, waging public battles against ill-conceived acquisitions, lacklustre directors or other alleged injustices. The motive is not some kind of altruism, but profit.