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    Case Study

    John Menzies confronts activist investor (A)

    By Anand Narasimhan and Nathalie Sophie Knauf
    2 pages
    November 2019
    Order this case study
    Reference: IMD-7-2124

    John Menzies Plc is a publicly listed company operating in the two unrelated and non-synergistic business divisions of newspaper distribution (only in the UK) and ground and cargo handling (second largest player in the world). Menzies Aviation, provides services to the international airline sector. This unusual corporate structure combines a fast-growing business, namely Menzies Aviation, with a business that is fighting with the structurally declining market of newspaper distribution, namely Menzies Distribution. In April 2015, Ian Napier, the Chairman of the Board of John Menzies Plc had just been approached by Lakestreet Capital Partners AG, an activist investment firm who called for a change in the company and wanted to split the two business areas. It was not the first time John Menzies had been targeted by an investment firm, however due to poor financial results and a decreasing share price, the pressure had increased. The case describes Ian Napier´s dilemma on what to do and how to respond. Is a break-up of John Menzies Plc when the activist shareholder Lakestreet Capital Partners AG called for it publicly truly in the best interest of John Menzies Plc shareholders? Could it also be the case that the corporate structure of John Menzies Plc has its merits? After all, Chairman Iain Napier said at the 2015 Annual General Meeting that the strong cash generation in the distribution business helps to support the expansion and investment needed in the fast-growing aviation arm.

    Learning Objective
    • The role of the Board of Directors vs. activist investors. How an activist investor can play a positive role in the governance system.
    • The role/fiduciary responsibilities of the Board. If good corporate governance was followed.
    • How the Board of Directors and Lakestreet Capital Partners AG (or shareholder activists in general) may have common interests. What the conflicts could be.
    • The strategic pros/cons of a conglomerate. Strategic short vs long term value creation.
    Keywords
    Strategy, Management, Value Creation, Corporate Governance
    Settings
    United Kingdom
    John Menzies, Travel and Leisure, Airlines and Aviation, Logistics and Supply Chain, Freight and Cargo Transportation
    2014 - 2018
    Type
    Published Sources
    Copyright
    © 2019
    Available Languages
    English
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    • John Menzies confronts activist investor (B)
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    John Menzies confronts activist investor (A)
    By Anand Narasimhan and Nathalie Sophie Knauf
    Case reference: IMD-7-2124 ©2019
    Summary
    John Menzies Plc is a publicly listed company operating in the two unrelated and non-synergistic business divisions of newspaper distribution (only...
    Read more
    Reference IMD-7-2124
    Copyright ©2019
    Copyright owner IMD Copyright
    Organization John Menzies
    Industry Travel and Leisure, Airlines and Aviation;Logistics and Supply Chain, Freight and Cargo Transportation
    Available Languages English
    Contact

    Research Information & Knowledge Hub for additional information on IMD publications

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    Copyright ©2024
    Copyright owner IMD Copyright
    Organization Daikin Industries
    Industry Consumer Goods, Home Appliances
    Available Languages English
    Contact

    Research Information & Knowledge Hub for additional information on IMD publications

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    in I by IMD
    Summary
    Learn why flashy innovation often fails and how a strategic, fact-based approach can drive real innovation success in corporate environments. Insights from industry experts.
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    Learn why flashy innovation often fails and how a strategic, fact-based approach can drive real innovation success in corporate environments. Insights from industry experts. In this final article in a series of three articles, Joep De Caluwé (EMB...
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