(Click for video linked to a searchable transcript of this Mad Money segment)

In the wake of a recent hostile takeover attempt, Jim Cramer takes a hard look at investor activism.

Does it really benefit individual shareholders?

Cramer says that even though he bemoaned the specific events involving Allergan and billionaire investor Bill Ackman, he firmly believes in most cases the answer is yes, activism works for shareholders.

When you're looking for stocks that could have significant upside, "sometimes you have to break eggs. Activists are fabulous egg breakers," Cramer said.

"Think about how much activist has made you over the years with his jabbing at Wendy's, Heinz, Dupont, and Ingersoll Rand," Cramer said.

"You must respect Carl Icahn's goading of countless companies to bring out value including, of late, Forest Labs, Chesapeake and Ebay all of which better served shareholders because of his pressure. Or the good work Dan Loeb did getting Yahoo! to clean house. Or how Elliott Management pushed Hess to streamline.

Although Cramer views the Allergan takeover through a slightly different lens, he concedes that even in this case, "I can't castigate anything that moves stocks up legally."

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Read more from Mad Money with Jim Cramer
Amazing Halliburton results present opportunity
Hostile Allergan bid: Cramer hoping Ackman whiffs
Gamestop: Short squeeze or short story?
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All told, Cramer believes activism benefits shareholders.

"The simple truth is that while some CEOs actively work for you to unlock value, others don't. They are the ones that need the fire lit. Activists simply provide the match."

Call Cramer: 1-800-743-CNBC

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