AST: Ownership Intelligence Redefined

AST: Ownership Intelligence Redefined

CIO VendorLouis Cordone, SVP of AST Ownership Intelligence “Who owns my shares? What do I need to know about both my registered and institutional investors to serve them more effectively? Why are they investing in my company?”—These are all common queries that public companies are trying to resolve as they seek to manage their outstanding shares more proactively. Getting insights into their shareholder base allows corporations to understand the consequences of their actions on their shareholders’ trading activity. With greater insight into their investors’ needs, companies can create stronger relationships with their shareholder audiences and maximize their marketplace experience.

Though it may sound straightforward, finding the right answer to basic shareholder questions like the ones above can be an uphill battle. Especially in today’s dynamic market environment, where shares are traded every tenth of a second, it is impossible to keep track of all transactions and shareholder information. None of the street, or institutional trading, information is available from the transfer agents, who once recorded all share market transactions. Organizations now access various financial reporting tools using information from public filings with the U.S. Securities and Exchange Commission (SEC) to determine their shareholders. A corporation can also collect data from filings such as Schedules 13D and 13G, which represent investors owning more than five percent of the company’s shares, or Form 13F, which is filed within 45 days after the end of each quarter by investors managing $100 million in equity assets. However, these techniques only help corporations see and analyze the tip of the iceberg.

Amid a fractured ownership data landscape, AST helps companies by leveraging its wealth of transactional data with a full spectrum of filing data to generate a more complete view of their shareholders and insights needed to drive business strategies. “We provide an integrated ownership intelligence platform to expose the ownership to clients, helping them understand their investors and offering them growth opportunities from a capitalization standpoint,” says Louis Cordone, SVP of AST Ownership Intelligence.

AST was originally founded as a transfer agent in 1971, but with the evolution of the share market, the company has also charted its own path of growth by expanding its footprint within the financial services realm. “In today’s world, a transfer agent has to go beyond transactions and think holistically about ownership,” says Cordone. “They need to gather data from disparate sources, build a layer of intelligence on it, and present that intelligence to companies. That is the crux of what we do.”

The company aims to partner with clients and leverage the power of ownership data to help them achieve their goals as a corporation. This journey has been powered by numerous strategic acquisitions of financial services firms, including proxy voting services provider D.F. King, an AST company, that have helped AST go from merely providing transactional information to leveraging data to offer both transactional and behavioral insights that can drive business success.


Our focus is not only to bring the next generation of an ownership front-end platform for better analytics, but also to enhance the way we process that information on the back end


Deriving Value from Ownership Data

Companies struggling to generate actionable shareholder analyses based on ownership information have begun to demand a solution. Answering their calls, AST recently launched Issuer Central, a single product that offers a comprehensive, 360-degree view of issuers’ overall share ownership with visibility into all shareholder-related issues.

The Issuer Central platform brings together various core functionalities—ownership intelligence, registry services, and in future updates, proxy and other services encompassing AST’s range of ownership services—into a single online ownership portal. The platform consolidates all shareholders’ positions, at both registered and street levels, into a single analytic-driven system that provides a complete view of ownership. Leveraging proprietary datasets from AST, Issuer Central helps companies achieve positive outcomes by enabling a meeting and communications strategy, in addition to providing procedural guidance. The platform runs the client’s ownership data and normalizes it to identify how business decisions such as mergers and acquisitions affect each shareholder and to determine its acceptability. The Issuer Central platform helps clients uncover business insights by analyzing and profiling each client based on net operating losses (NOL), benefits from different tax regulation, and various factors unique to that client. Analyzing this data through Issuer Central equips clients with a dynamic customized dashboard where any user—stock administrator, investor relations officer, general counsel, or corporate treasurer or secretary— can view critical information each requires to plan ahead for corporate audits, annual general meetings, and other corporate actions.

From an investor communications and financial reporting standpoint, it is important for companies to present their corporate strategies in the ways that are most relevant to their shareholders, highlighting certain transactions and numbers to encourage them to support company management and to invest. “By helping them know who their shareholders are—and how their ownership profiles are unique—we enable companies to build their knowledge of shareholder relationships and position themselves as better candidates for investment,” explains Cordone.

In addition, AST specializes in helping clients identify the risks and the costs of shares. For instance, when clients have to generate financial reports, they often try to identify investors with fractional shares, which can be created as a result of events such as dividend reinvestment or corporate acquisitions. Because fractional shares are negligible in size and obscurely created, a large portion of these shareholders may have sold most of their shares but not realize they still own fractional shares. In such cases, companies can use AST’s decision-driving analytics to decide whether they should spend money on financial printing and reporting for these investors or buy their fractional shares back. AST also offers clients customized bondholder identification reports that include detailed information on their outstanding bonds.

Through AST’s identification reports and outreach programs, clients get vital information on potential buybacks, exchanges, and debt restructurings.

AST also enables clients to ensure compliance with all regulatory tax requirements by providing complete information about shareholders, including countries of citizenship. In case of a merger or acquisition, AST compares the client’s ownership data with that of the peer, identifying the shares that will be owned by the target company’s shareholders. This uncovers the changes in the company’s shareholders and measures the risk involved in losing the associated tax benefits.

After assessing clients’ ownership opportunities and vulnerabilities, AST offers guidance on solicitation strategy and tactics necessary to achieve high participation and support levels. The company also presents insights into clients’ corporate governance strategies aligned with investor benefits to proxies, who can further communicate to the investors and aid in favorable voting outcomes.

Establishing New Milestones

With an extensive client base all across the U.S., AST has a unique perspective on best practices in multiple industries. Aside from ownership intelligence, AST also delivers a comprehensive portfolio of solutions and services including corporate governance and advisory services, issuer and mutual fund proxy services, equity plan solutions, restructuring services, and class action and mission-critical services. Through its issuer and investor services, the company aims to assist clients on shareholder engagement, equity-based plans, and asset recovery. With regard to governance and proxy services, AST offers transactional, advisory and solicitation solutions to assist clients in initiating targeted investor communications campaigns and managing mutual fund administration. When needed, clients can also benefit from the company’s restructuring services, which help manage the administrative functions and assist corporations in all aspects of the corporate restructuring process.

"We provide an ownership intelligence platform to expose the ownership to clients, helping them understand their investors and offering them growth opportunities from a capitalization standpoint"

Under the leadership of CEO Brian Longe, an accomplished executive with more than two decades of experience in financial technology, AST has established an ambitious leadership blueprint for the company’s future. With the rollout of Issuer Central’s ownership intelligence module, AST has already achieved the early milestone of integrating and normalizing comprehensive ownership information, empowering every corporation with the means to achieve its capitalization objectives. “Our focus is not only to bring the next iteration for better analytics, but also to enhance the way we gather information,” says Cordone.

Positioned at the forefront of AST’s technological transformation, Longe has dedicated much time and energy to figuring out how to build new visionary technologies to lead and transform the industry. While Issuer Central drives that vision for front-end systems, AST is also building a leading-edge proxy voting back-end solution using blockchain technology. This service will provide near-real-time and immutable vote tabulation and reporting, while delivering greater access and transparency to campaign setup, status, and results with user-configurable reports. “We are pioneering the model of applying blockchain to proxy services to provide accurate and secure data collected from multiple sources,” concludes Cordone.

- Khyati Dubal
    June 29, 2018

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FREMONT, CA: “We provide an integrated ownership intelligence platform to expose the ownership to clients, helping them understand their investors and offering them growth opportunities from a capitalization standpoint,” said Louis Cordone, SVP of AST Ownership Intelligence.
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