Activist hedge funds are gearing up for a resurgence in public campaigns, with legal and banking advisers forecasting a marked increase in shareholder pressure tactics as global M&A momentum returns in the second half of 2025, according to a report by Reuters.
After a subdued second quarter – with activist campaigns down 16% from Q1 and 32% year-on-year – market participants expect a significant uptick in activity, particularly targeting underperforming boards, spin-off opportunities, and operational improvements.
Advisers say hedge funds including Elliott Investment Management, Jana Partners, Sachem Head, and Starboard Value are sharpening strategies, supported by a growing belief that dealmaking conditions are stabilising and equity market volatility is becoming more manageable.
While macro concerns – including policy uncertainty from the US election cycle – kept many activists on the sidelines in Q2, private agitation remained strong behind the scenes, according to Goldman Sachs. The recent build-up of a stake in Tripadvisor by Starboard marks an early sign of renewed momentum.
Companies, meanwhile, are bracing for impact. Several boards are proactively engaging advisers to conduct vulnerability assessments, considering changes in leadership or governance structures to ward off potential campaigns. Activists have so far focused on board reshuffles, appearing in 43% of H1 campaigns, with expectations that M&A-related demands – which appeared in just a third of cases – will become more prominent heading into the fall.
Institutional investors, who collectively oversee $35tn in assets, are broadly supportive of activism as a constructive force. According to SquareWell Partners, 77% see it as a catalyst for corporate change, and 71% as a mechanism to hold management accountable.
While the traditional public proxy battle isn’t disappearing entirely, there is a clear trend toward private engagement and settlement-driven outcomes. Activists appear increasingly willing to forgo messy public fights in favour of negotiated board seats and governance reforms – as demonstrated by Jana Partners’ recent settlement with Lamb Weston.
