Former Georgeson proxy solicitors start new firm
NEW YORK, Feb 19 (Reuters) - Two former senior managing directors of proxy solicitation firm Georgeson Inc on Tuesday said they launched a new firm amid resilient demand for proxy services and rising shareholder activism.
The new firm, called Okapi Partners LLC, was founded by Bruce Goldfarb and Patrick McHugh, who have long experience advising parties on various sides of corporate battles.
Proxy solicitors advise companies in transactions such as mergers and acquisitions, often working behind the scenes to persuade shareholders of the merits of a deal.
They may also advise companies under pressure from shareholder activists including a rising legion of hedge funds, or advise the activist hedge funds or mutual funds who oppose management initiatives.
The field is currently dominated by a handful of firms including Innisfree M&A Inc, MacKensie Partners, D.F. King & Co. and Georgeson. Innisfree, for instance, is advising Microsoft Corp (MSFT.O) in its hostile bid for Yahoo! (YHOO.O), while MacKensie is advising Yahoo.
Goldfarb said there is much demand for new proxy firms, since existing firms may have conflicts of interest preventing them from advising potential clients.
"There is a very limited universe of first rate proxy solicitors," said Goldfarb in an interview. "We aim to provide senior level advice to clients free of the potential for conflicts."
In addition, corporate transactions have generally become increasingly complicated, with various constituents including major shareholders, dissidents, companies and other parties seeking to press their views on transactions, said Goldfarb.
The trend has increased demand for solicitation services, which often work with investment bankers and lawyers on company transactions.
Among other situations, Goldfarb advised Walt Disney Co (DIS.N) when Roy Disney was seeking to oust CEO Michael Eisner. He also advised Hewlett-Packard Co (HPQ.N) when it was under pressure from founder Walter Hewlett to drop its bid for Compaq.
He said the New York-based firm already has two clients, which he declined to name. (Reporting by Dane Hamilton; Editing by Gary Hill) (Reuters email: dane.hamilton@reuters.com. 646 223 6161. Reuters messaging: dane.hamilton.reuters.com@reuters.net)
