Hedge fund Irenic calls on Canadian firm Kinaxis to conduct strategic review

NEW YORK: Hedge fund Irenic Capital Management on Tuesday urged Kinaxis to investigate who might want to buy the Canadian software company and warned its board against making “reactive decisions” and taking “half-measures.”

The board “should initiate a full strategic review, including seeking to acquire interested parties for a sale of the entire company,” Irenic said in a statement, echoing calls from other private and public investors to put the company up for sale.

Irenic, led by former Elliott Investment Management and Indaba Capital Management executives Adam Katz and Andy Dodge, called Kinaxis a “world-class software company” that needs a new CEO and sales chief, and needs to evaluate interest in the company from potential financial and strategic buyers.

Earlier Tuesday, the supply-chain management software provider said it had hired Goldman Sachs, without disclosing a purpose. But it also said its board “strongly believes that executing on its strategic plan is the best path to maximizing shareholder value.”

Irenic said Kinaxis’ new executive chairman, Robert Courteau, has said there has been interest from financial backers, but the board is not willing to work with them at this time.

“The board is focused on enhancing shareholder value and is fully aware of its fiduciary responsibilities and will continue to act in accordance with them,” a Kinaxis spokesman said.

The spokesman did not respond directly to a request for comment on the company’s interest and the manner of its cooperation.

Irenic said the board could not make a decision on the “best way forward without first considering alternatives,” expressing concerns that the board was not fully considering the potential interest in the company.

Investment firm Daventry Group last week publicly called for Kinaxis to put itself up for sale, calling the company a high-quality asset that many buyers would pay a “healthy premium” to own.

Daventry, together with its affiliates, beneficially owns or controls approximately 1.4 percent of the outstanding shares of Kinaxis, which have a market value of approximately $3.2 billion.