Activist investors are still dominating news headlines this year.
Here are some of the biggest activist related events this week, compliments of The Deal, a sister publication of TheStreet. Sign up for The Deal's hot new daily activist newsletter here.
Procter & Gamble Is Under Siege
Jefferies analysts see Nelson Peltz's proxy fight to win a seat on Procter & Gamble Co.'s (PG) board as motivation for the company to "raise the execution bar, which is supportive of a higher multiple," analysts wrote this week.
P&G has lagged peers in the staples group and the S&P 500 for as long as 10 years. The company has lost market share in key categories and will likely fall "modestly short" of returning to market growth rates again in 2017, Jefferies said.
Peltz's "perceived value" as a member of the board "may lead to greater/faster realization of cost-savings and/or raise the execution bar at P&G, all likely to result in a higher multiple," Jefferies wrote.
Peltz has a "long and well respected history" in advocacy at consumer staples companies. He's currently a director at Mondelez (MDLZ) , Sysco (SYY) , The Madison Square Garden Company (MSG) and Wendy's (WEN) , but he's expected to resign from at least one of his current roles if nominated to P&G's board.
Blue Apron Has Been a Bust
Meal kit delivery company Blue Apron Holdings Inc. (APRN) sought to protect itself from a potential onslaught of activist hedge fund managers by issuing three classes of shares in its IPO last month, including one that gives its CEO and insiders stakes with ten votes per share.
The goal was to allow the company to grow independently without worrying about being pressured by an insurgent investor into a sale. However, that move may be backfiring. The FTSE Russell, the company behind the Russell 3000 index, is moving in the direction of excluding companies from its indices that issue shares with either only non-voting rights or those that give outside investors very limited voting rights. Blue Apron falls into that second category.
If the FTSE adopts a proposal it has under consideration, as many expect, it would likely represent a major defeat for Blue Apron, Snap Inc. (SNAP) and other companies that give insiders control of the votes. The proposal was prompted by institutional investor outrage in response to a move by Snap's underwriters to take the company public in March with only non-voting shares.
Tesla, Tesla, Tesla
James Rupert Murdoch, the CEO of Twenty-First Century Fox Inc. (FOXA) , and Linda Johnson Rice, the chairman of Johnson Publishing Co., will join Tesla's board, according to a company blog post.
Though the new board members are indeed independent, they lack experience at an industrial company and are loosely tied to technology.
It's unclear whether the move will appease disgruntled investors. A group of pension funds have urged Tesla in recent months to add more independent directors. The funds had raised concerns that the company's board is made up of too many directors overly tied to Musk.
However, Tesla expanded its board size to nine from seven to add the two new directors. As a result, it is unlikely to appease investors who would have preferred to have some incumbent directors removed.
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