In September 2019, I wrote: “Edward Bramson is keeping a close eye on Barclays and may be waiting for a blunder to again intervene.” I was referring to possible weak financial results and stock price performance, but this has taken a back seat lately, at least publicly, after revelations of a government investigation into CEO Jes Staley’s business links to financier Jeffrey Epstein, who died in prison while awaiting trial for child sex trafficking.

While Bramson indicated that Staley’s link to Epstein is a separate governance issue, the revelations might help him achieve his campaign goals quicker, given that Staley is viewed as the main roadblock to shedding the low-return investment bank, the activist’s key demand. The activist, which said it acquired additional shares and is now the largest shareholder, strongly implied that Staley should be sacked as CEO as well, and not given “a path to a graceful and protracted exit ending in retirement,” alluding to a Financial Times article that reported Barclays was on the lookout for candidates to replace Staley next year.

For Bramson, the investigation came at the right time, just before the annual meeting, allowing him to shift the narrative from Barclays’ investment banking unit’s low return on tangible equity (ROTE), an argument that failed to convince shareholders change was required last year, to the more headline-grabbing relationship between Staley and Epstein. ESG (environment, social and governance)-conscious funds might be more susceptible to Staley’s ethics than his performance, and Bramson is trying to force their hand.

In a public letter, Bramson indicated that any shareholder that votes for Staley’s re-election as director is an “enabler” of Epstein’s conduct, irrespective of whether this is occurring in the present or in the past. Same goes for a board that supports a director in such circumstances and a financial institution that provides services to a client engaged in child prostitution, Bramson said.

This could resonate with other shareholders, according to Ali Saribas, a partner at shareholder advisory SquareWell Partners. “As investors focus a lot on corporate culture and gender equality, having a person leading an organization that allegedly had links with Jeffrey Epstein does not position him in a positive light in terms of character/judgement,” Saribas told me, adding this could prompt investors to vote against his re-election due to fears about reputational damage and the distraction from the investigation.

Nor has Staley’s performance been stellar. After a strong third quarter in which the bank posted an overall ROTE of 10.2% and the stock started to recover, Barclays disappointed in the last quarter of the year and indicated it might not reach its target of more than 10% ROTE in 2020. Coronavirus fears and expectations of interest rate reductions have hit the stock further.

In a letter seen by Activist Insight Online, Bramson attributed the strong results in the third quarter to “enough fortunate one-time items available,” and said the bank’s 10% return aspiration for 2020 “will require an heroic effort.” He added the board’s failure to fully appreciate the investment bank’s real potential “has led to wishful thinking about the business and the returns it can achieve.”

Barclays’ annual meeting last year, which I attended, was heated, with many shareholders expressing their frustration over the share price performance and some publicly backing Bramson’s bid to join the board. This year, shareholders have even more reasons for discontent and Bramson a stronger likelihood of making headway in his campaign.

Elsewhere in the news:

The March 2020 issue of Activist Insight Monthly is now available for all subscribers to download.

This issue features activists’ use of books and record demands, and also includes our quarterly update on the most recent personnel moves and promotions with the space, and a profile of Japan-focused activist, Dalton Investments. The magazine is available for subscribers of Activist Insight Monthly at this link. To learn more about a subscription, email

This week’s in-depth story considers the validity of Warren Buffett’s remarks that “non-wealthy” independent directors are more interested in lining their pockets than doing what’s right for shareholders. Spoiler alert: he might be right.

In moves, Pete Michelsen, Goldman Sachs’ head of activism and shareholder advisory for the Americas, is leaving the firm to join investment bank Qatalyst Partners in San Francisco. Meanwhile, communications firm Sloane, which represents both issuers and activists, named Dan Zacchei its president, special situations and promoted Joe Germani to managing director in the same team. The March edition of Activist Insight Monthly has a full list of hires and promotions that took place over the past quarter in the shareholder activism space.

HP’s board advised against Xerox’s third offer, saying it still undervalued the company. The decision came shortly after Canon said it would cut ties with HP if Xerox takes control.

Elliott Management reportedly advanced a four-person slate at Twitter after taking a 4% stake in the social media firm.

Kansas City-based utility Evergy agreed to install two directors and establish a strategic review committee as part of a settlement with Elliott Management, around a month after the activist demanded more infrastructure investments or a sale.

The fight between Hudson Executive Capital and USA Technologies took an interesting turn, after the company added three dissident nominees to its slate without their prior approval and put forward a proposal for a shareholder vote on whether it can directly prosecute Hudson Executive to seek disgorgement of the hedge fund’s profits from its investment in the company. Hudson Executive said the move to add the dissident directors was “a desperate attempt to manipulate” the upcoming board elections.

Elliott and Bank of East Asia paused their legal proceedings after the Li-family controlled bank announced a strategic review.

Sachem Head Capital Management reached a settlement agreement with Olin that will see Scott Ferguson’s fund given two board seats. The activist had nominated four directors.

Saba Capital Management plans to nominate 10 candidates for the Voya Prime Rate Trust board.

In the latest development of the bidding war for phone company Cincinnati Bell, Macquarie Infrastructure and Real Assets increased its bid to $14.50, prompting Brookfield Infrastructure to match it. This is music to the ears of Gamco Investors, which owns a 7.8% stake and threatened a proxy fight at Cincinnati Bell before the bidding war broke out. Gamco’s Mario Gabelli tweeted that every dollar per share equals an additional $50 million for shareholders, with Gamco getting around $3.5 million of that. The initial agreement between Cincinnati and Brookfield valued the company at $10.50 per share.

Sirius Minerals’ shareholders voted in favor of the Anglo American merger despite opposition from Odey Asset Management and ShareSoc.

Firefly Value Partners nominated two directors to the board of natural gas company Gulfport Energy, saying “meaningful change is required” for shareholders to realize the value of the company’s assets.

As always, Activist Insight Online reporters will be diligently covering all developments in activism around the world, and Iuri Struta will be highlighting the most remarkable stories in this roundup. If you have suggestions for improving our coverage, or a tip, you can contact us at