(Bloomberg) -- Canadian software provider Kinaxis Inc. pushed back against activist investors urging the company to seek a sale, saying it’s focused on creating shareholder value.
Daventry Group LP, which owns a 1.3% stake in the company, released a letter last week asking Kinaxis’s board to begin exploring a sale. Another investor, Irenic Capital Management LP, made a similar plea in a statement Tuesday.
Kinaxis, which provides supply chain management software, responded in an emailed statement that “the board is focused on enhancing value for shareholders, is fully aware of its fiduciary duties, and will continue to act accordingly.”
Daventry first voiced its concerns after Ottawa-based Kinaxis announced that Chief Executive Officer John Sicard plans to retire by the end of the year, criticizing the company’s underperformance and the board’s operating plan.
Kinaxis said Tuesday that Chairman Robert Courteau has been named executive chair and will remain in that role until a new CEO is found. The board hired a management consulting firm to improve profitability and capture more clients, and tapped Goldman Sachs Group Inc. for financial advice on its strategic plan.
“The new executive chair revealed to Irenic that there has been inbound interest from financial sponsors, but that the board is currently unwilling to engage those sponsors,” Irenic said in its statement. “This is wrong. To be clear, this board should not sell Kinaxis at any price. It should follow a proper process that considers all options.”
Jarislowsky Fraser Ltd., the largest shareholder with an 11% stake, has said it’s not the right time to sell, urging investors to wait for profit to improve under a new CEO.
Kinaxis shares have fallen 6% in the past 12 months, trailing the 19% gain in the S&P/TSX Composite Index, with dividends included.
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