New York. Elliott's entry into Deutsche Telekom is about more than just a stake: the US hedge fund apparently wants to prevent the group from merging with its US subsidiary T-Mobile. Instead, Elliott advocates expanding share buybacks or other measures to increase stock market value.
Kai Liefekett knows exactly how companies deal with such demands. He is probably one of the most renowned corporate defense lawyers in the United States. His job: defend companies against hostile takeovers and activist investors. His client list reads like a who’s who of US business: AT&T, Hasbro, Blackrock, the New York Times.
In an interview with Handelsblatt, the 51-year-old describes why defending against activist investors is like an election campaign, how companies can prepare and why the first few hours count for defense.
The New York office of the US law firm Sidley Austin appears inconspicuous from the outside, just one skyscraper among many. Little can be said about the history of the law firm, which was founded in Chicago in 1866 and is now one of the top elite legal firms in the USA. One of the first clients was Mary Todd Lincoln, the wife of US President Abraham Lincoln. Barack and Michelle Obama met at Sidley Austin, where they worked as lawyers. And also the current US Vice President J.D. Vance worked at the office, albeit briefly.
Liekefett grew up in Salzgitter and is now a partner in the law firm. There he heads the areas of shareholder activism and corporate defense as well as public company advisory together with a colleague. Liekefett describes himself as a mixture of campaign lawyer, campaign manager and hostage negotiator.
In the past five years alone, he and his team have represented companies in more than 150 activist campaigns, hostile takeovers and battles for shareholder votes, so-called proxy fights.
What do activist investors do?
The phenomenon of activist investors or “shareholder activism” has been around since the 80s. According to Liekefett, the phenomenon only really took off in the 2010s. Unlike hostile takeovers, activists don't want to buy the entire company. Rather, financial investors try to exert pressure, sometimes even with small stakes, in order to make strategic changes such as a spin-off.
According to the analysis platform Diligent, the demand for a sale of US companies - or parts of them - increased by almost 50 percent in the first half of 2026 compared to the same period last year.
How do activists achieve their goals?
The range of measures ranges from private conversations with management to media campaigns and attempts to replace the board of directors and supervisory board.
In Germany, activist investors appear far less often. In 2018, the hedge fund Elliott, run by US investor Paul Singer, and the Swedish investor Cevian put the German industrial giant Thyssenkrupp under so much pressure that both CEO Heinrich Hiesinger and supervisory board chairman Ulrich Lehner ultimately resigned. Lehner even accused some investors of “psychoterrorism”.
They do exist, these spectacular cases. But only in very few cases did the disputes between activist investors and companies actually escalate into proxy fights, says Liekefett. According to Diligent, activists secured 84 of 85 board seats in the first half of 2026 as part of a negotiated settlement - without a battle vote.
But if it comes to that, the fight will be tough. At general meetings, activist investors, especially hedge funds, try to convince enough shareholders of their own candidates for the supervisory board or top position who support their plans. Proxy wars, says Liekefett, are just another type of business negotiation.
According to Liekefett, these occur in three situations. If the investor wants to sell the company or fire the boss and the supervisory board refuses - or if the activist himself pushes his way onto the supervisory board to enforce one of these points. “90 percent of proxy fights can be traced back to these three scenarios,” says the expert. According to Liekefett, the remaining ten percent can be attributed to extraordinary circumstances.
This is also likely to include campaigns by former insiders who have turned against the leadership of their former company. A prominent example of this is Walt Disney's nephew Roy E. Disney. After his departure from the board of directors in 2003, he started the “Save Disney” campaign, which ultimately persuaded then-Disney boss Michael Eisner to resign.
How can companies prepare themselves?
When it comes to defending yourself against investors, Liekefett says there is a difference between peacetime and the moment when the activist is already at the door.
In times of peace, they work on advantageous legal structures for the company. You can't change your statutes so that they don't allow activists. There are still ways to give the company tactical advantages in the dispute. It's about being prepared when an activist attacks, says Liekefett.
The first few hours are crucial for the affected companies, says Liekefett. It’s the “things you say in the first few hours of a campaign that can really become a problem.” The most important thing is to be well prepared: What media statement do you release? What do you tell investors, corporate customers or your own employees? The mistakes made in the first few hours could hardly be corrected later.
The iPhone manufacturer Apple also found out in 2013 how sudden such attacks can come. At the time, activist investor Carl Icahn made his position in the company known in messages on Twitter, along with calls for a significant increase in share buybacks. In the end, a compromise followed: Apple expanded its share buybacks, although not to the extent that Icahn demanded. The investor then withdrew and exited with billions in profits.
The best tactic to defend yourself against activist investors? Finding ways to disqualify or put legal pressure on the other side, says Liekefett. “And if the courts don’t come to our aid, we have to convince the shareholders.”
This involves major shareholders, but also powerful voting rights advisors such as ISS and Glass Lewis, who, at least in the USA, have great influence on the voting behavior of institutional investors. In the age of social media, private investors who can organize themselves online are also becoming increasingly relevant.
Campaigns with many private investors are more complex, says Liekefett, but also more interesting for this very reason. “We use call centers that try to reach retail investors day in and day out.” You have to adhere to legal rules, but ads can also be placed on Facebook, Instagram or Linkedin in such a case.
There are investors who immediately went public with their campaigns. Most activists first sought confidential discussions with the companies, says the 51-year-old.
“The first piece of advice we always give is constructive delay.” You should try to work with investors to see where there is common ground.
It is often the case, says Liekefett, that in 60 to 80 percent of cases companies agree with the views of investors. When an activist calls for the company to be split up or sold, the company is often already there. “Many times when an activist says the CEO has to go, he may already be on the hit list,” Liekefett adds.
What are activists looking for?
For Liekefett, activist investors are primarily “value investors”. They are looking for weak companies in strong sectors. “They try to figure out why that is and go to the company with their ideas.”
From the expert's perspective, activist investors are currently focusing on two sectors in particular: technology, especially the software sector, and the consumer goods sector.
Liekefett points out that activists also favored industries that are not heavily regulated. For the lawyer, this is one reason why they are reluctant to join banks or insurance companies. In addition: “They like to go into sectors that are easy to understand,” says the lawyer. According to the 51-year-old, most activists are generalists.
What is the situation in Germany?
In Germany too, companies are repeatedly the focus of activist investors. But overall, the structures of German companies made it difficult for them to take control. Although Liekefett helps companies fend off financial investors, he takes a different stance when it comes to Germany. “I’ve been waiting every day for 15 years for more activists to finally attack Germany,” says Liekefett – precisely because Germany is so close to his heart.
