The boardroom battle at ARYZTA is set against a challenging operational backdrop and associated share price weakness. Its timing will likely distract from an unprecedented operational circumstance and the Rothschild strategic review process. The activist’s near-term playbook is for Board-level changes tilted to bakery experience. Consistent with our earlier views, for the equity to respond, volume and margin challenges in North America must be resolved. Over the longer term, the capital structure will need to be rebalanced. Given management’s actions to date and the unprecedented environment, we believe there are no silver bullets for the equity.