Activist hedge funds have ramped up their campaigns at South Korean companies with 77 businesses targeted last year compared with just eight in 2019, marking a tenfold increase in activity according to a report by Chosun.
The report cites a “Emergence and Challenges of Shareholder Activism,” a recent report commissioned by the Federation of Korean Industries (FKI) and conducted by Kim Su-yeon, a research fellow at Lee & Ko, South Korea as highlighting that hedge funds don’t merely invest but actively intervene in corporate governance, often pushing for increased dividends to boost short-term stock prices.
The US and Japan have traditionally topped the list for activist hedge fund targets, but South Korea climbed to third place last year on the back of a 57% increase in activist campaigns, compared with a 9.6% increase in North America, and 7..4% fall in Europe.
