Allison Bennington, a longstanding executive at activist hedge fund ValueAct, known for shaking up the boards of Microsoft, Rolls-Royce and Citigroup, is switching sides and joining boutique investment bank PJT Partners to help companies defend themselves against corporate raiders.
Ms Bennington is joining as a partner and will use her experience during a 17-year career at ValueAct to advise PJT’s clients on how to better prepare for and respond to activist campaigns. She will work closely with its merger and acquisition bankers and its investor relation advisory unit, PJT Camberview. She will also lead the firm’s environmental, social and governance advisory practice.
“I have been inside the mind of an activist,” Ms Bennington said in an interview. “I understand the activist types, the tools at its disposal, and I understand how an activist deploys those tools.”
Ms Bennington’s high-profile switch from corporate poacher to gamekeeper is a rare move for a Wall Street investment bank. The two sides are seen as inexorably incompatible by many company executives who demand extreme loyalty from their advisers.
Paul Taubman, the chief executive of the investment bank bearing his initials and one of Wall Street’s top dealmakers, said Ms Bennington will provide a unique perspective that will give his company a competitive advantage over his rivals.
“Having had the unique perch on the other side I think she’s extraordinarily well suited to lead our activism effort,” Mr Taubman told the Financial Times. “I think that gives us another arrow or two in the quiver.”
At ValueAct Ms Bennington worked alongside founder Jeff Ubben, who recently also left the firm to launch a new ESG fund. The group is known for taking a “friendlier” approach to activism than the tougher stance espoused by the likes of Paul Singer’s Elliott Management and Carl Icahn.
Activists usually buy a minority stake in a target company and then follow up with a series of demands. This can include calls for board seats, management overhauls and asset sales, among other things, in an attempt to drive up shareholder value.
After giving chief executives a respite this year while they grappled with the fallout from the coronavirus pandemic, activists are busy identifying opportunities that have emerged from the market dislocation.
“As the dust settles this longer-term trend towards investors being more engaged and pushing for companies to take actions will accelerate not level off,” said Abe Friedman, a partner and head of PJT Camberview.
Ms Bennington said the pandemic will also breed a host of new issues for companies that will bring environmental, social and governance investing to the forefront of activist strategies.
“We have a recession on our heels, we’ve seen huge societal change over the last few months and we have climate change issues,” she said. “Then there’s an avalanche of regulatory issues coming at us which you’ve already seen in the EU and I think you’re going to see in the US.”