What's going on?

The battle for control of Barclays heated up further on Monday after a prominent activist investor published a letter to other shareholders warning that the British banking giant was in a precarious position.

What does this mean?

Edward Bramson, whose company owns a 5.5% stake in the bank, reckons that unless Barclays trims its investment banking activities it�ll have to raise extra money from investors � making existing shares worth less. While investment banking delivered half of Barclays� profits last year, it can be an expensive and unreliable business � which might have something to do with Barclays� investment banking head prematurely stepping down two weeks ago.


Raising extra cash is a sore subject at Barclays � when it did so at the height of the 2008 financial crisis, the bank�s then-bosses allegedly misled investors. The jury in a landmark fraud trial against four former Barclays executives � all of whom deny the charges � was mysteriously discharged on Monday.

Why should I care?

For markets: Barclays is in uncharted waters.

Barclays� stock fell slightly on Monday. While Bramson�s views aren�t new, they�re getting louder as he pushes for a seat on Barclays’ management board. Perhaps investors selling the stock agree with Bramson. Or perhaps they�re keeping an eye on the court case, worried about the protracted negative impact of a possible retrial. If the eventual verdict is not guilty, there may be less cause for change at Barclays � which, depending on where investors stand, could be a good or a bad thing.

The bigger picture: Activists pack a punch.

US-listed shares of electronics giant Sony jumped 8% on Monday on news that another activist investor was building a stake in the company in order to pressure management to make changes, including potentially selling Sony�s movie studio. Both Amazon and Netflix are said to have expressed interest in the studio � and with Disney also building content for its forthcoming streaming service, competition could be fierce.