After 7 years at the head of Thyssenkrupp, Heinrich Hiesinger resigned from one of German's top industrial giants. What's coming increasingly common was that this was driven by shareholder anger over slumping revenue and shareprice.
And even after setting up an agreement with Tata Steel - the deal gained significant oppostion from investos and labour unions. It was during this deal that Hiesinger also lost the support of his board.
This change was driven by two activist investors that control about 20% of the company - Elliott Management Corp. and Cevian Capital - who both pushed for more radial changes and opposed Hiesinger's leadership. It all happened quite fast as Elliott only took a stake in the company this year.
But what this reflects is a critical importance for companies to monitor their current and prospective shareholder base. To proactively control the messaging and implement targetted strategies to ensure alignment with shareholders.
Thyssenkrupp is just another example of how quickly a divergence in vision between management and the board / shareholders can have an impact. This is also is a great example of how the role of IR is changing and the importance of companies to spend the time to find the right shareholders - those that are both aligned and engaged.
Read a full article on this event at Bloomberg here.
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