Are private equity buyers more targeted and responsive to activism against mergers?

Since 2005, deals involving a private equity buyer have received a disproportionate amount of activist attention. Although private equity deals have made up 14.8% of all agreed-upon transactions, 29.7% of transactions attracting activist attention had a private equity buyer.

Though Seneca and Icahn are facing tough odds, some factors are in their favor. Private equity firms have shown that they are significantly more flexible than corporate buyers, as PE firms sweetened 36.4% of deals in which they faced activism, while non-PE buyers sweetened in only 25.6% of opposed deals (from 2005 to present).

Blackstone itself has faced shareholder activism in one agreed-upon deal. In that campaign, Biomet, Inc. shareholder P. Schoenfeld Asset Management LLC agitated against a 2007 acquisition by a Blackstone-led group; after the consortium sweetened its bid from $44 to $46, shareholders approved the deal.

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