Wyser-Pratte and Vendex (B)

Published 06 Jan 2004
Reference 5212
Region Europe
Summary

Fresh from his victory for increased shareholder rights, corporate raider Wyser-Pratte, together with a coalition of active investors, tries in this (B) case to use their newfound rights to influence the strategic direction of the Vendex company. In contrast to Wyser-Pratte's comments in the previous year, one investor - K Capital Partners - pressures management and the Supervisory Board to consider selling the company, in the belief that the conglomerate is undervalued and that an acquirer would easily pay a 100% to 200% premium over the current share price, thereby maximising shareholder value.

Teaching objectives

The purpose of this case is to allow a discussion on who is really in the best position to make strategic decisions within a company, management or shareholders? Students can discuss if they believe that active investors act in the interests of alle shareholders (or stakeholders) or that they are simply looking for whatever short-term gains they can get? Does an increase in shareprice reflect the long term value creation potential or of the company or merely give investors the opportunity to divest?

Keywords
  • CORPORATE GOVERNANCE
  • SHAREHOLDER ACTIVISM
  • SUPERVISORY BOARD
  • BOARD OF DIRECTORS
  • SHAREHOLDER PRESSURE
  • STRATEGIC DECISION-MAKING
  • Corporate Governance
  • Investors, Stakeholders and Accountability