U.S. shareholder activism up in 2007-research firm

By Megan Davies

NEW YORK, Jan 8 (Reuters) - U.S. shareholders increasingly bared their teeth last year, with a 17 percent jump in the number of campaigns launched for corporate change, according to data from research firm FactSet SharkWatch.

The number of activist campaigns rose to 501 in 2007 from 429 the previous year, the firm said.

Those campaigns were either pushing for control at companies, or asking firms to boost shareholder value by putting themselves or their subsidiaries up for sale or by returning cash to shareholders.

The rise was mainly due to an increasing number of hedge funds, said John Laide, product manager of FactSet SharkWatch, which provides research on corporate activism and proxy fights to financial and legal clients.

"There are so many out there ... and they have to be active in terms of manufacturing returns," Laide said. "There are a lot of funds out there chasing a limited amount of situations."

That could continue into 2008, he said, if share prices of targets get beaten down.

"Most of these activists are value investors," he said. "So if things start getting beaten down, there will be plenty of opportunity for them."

SharkWatch's research said activists were also more willing to escalate their tactics and wage formal proxy fights. More proxy fights were waged in 2007 then any other year since it began tracking proxy fights in 2001, it said.