Abstract
This article discusses the interaction between shareholder activism and the concept of acting in concert as applied under the takeover provisions of the Companies Act 71 of 2008. The takeover provisions are aimed at protecting minority shareholders during takeovers. Shareholder activism is on the increase throughout the world. It is viewed both positively and negatively. Shareholder activism is on a wide spectrum. Shareholder activists may seek to bring about a number of changes in a company, including better performance, change in management or even a takeover. This article discusses shareholder activism, focusing on the change of control transactions in companies – takeovers of companies. This is particularly relevant in view of the assertions that the application of acting in concert rules under the takeover provisions may deter shareholder activism. The article proceeds as follows: it provides an introductory remark on shareholder activism and its interaction with the takeover provisions; briefly deals with takeover transactions and defines the concept of acting in concert; as well as exploring how this concept is applied during takeovers, both in South Africa and in the United Kingdom. The article concludes by highlighting how acting in concert provisions seeks to strike a balance between shareholder activism and the powers of directors to manage the company’s affairs. Finally, it makes suggestions on how shareholder activists should proceed so as to avoid falling foul of the takeover provisions.