What Happened?
Shares of electrical safety company Atkore (NYSE: ATKR) jumped 2.6% in the afternoon session after it extended gains from the previous day as it was reported that activist investor Irenic Capital Management has acquired a stake and is urging the company to pursue a sale. The positive momentum follows Tuesday's news, where the stock also rose after reports revealed Irenic Capital had built a 2.5% stake in the electrical manufacturing company. According to sources familiar with the matter, Irenic has privately engaged with Atkore's board, advocating that a sale to a private equity firm would be the best outcome for shareholders. This development comes as Atkore is already exploring its strategic options. The company had previously disclosed it is "evaluating a broad range of alternatives" and has reportedly enlisted Citigroup to assist with its strategic review process.
The shares closed the day at $64.15, up 2.3% from previous close.
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What Is The Market Telling Us
Atkore’s shares are somewhat volatile and have had 13 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 1 day ago when the stock gained 2.1% on the news that activist investor Irenic Capital Management built a 2.5% stake in the company and urged it to pursue a sale. According to reports, Irenic privately engaged with Atkore's board and management, contending that a sale to a private equity firm represented the best outcome for shareholders. This news followed Atkore's own update on its strategic plans. The company's board and leadership team announced they were evaluating alternatives to focus on Atkore’s core electrical infrastructure business. As part of this review, Atkore considered the potential sale of its HDPE pipe and conduit business. Additionally, the company took steps to reduce costs through a headcount reduction and planned to consolidate three manufacturing facilities. Separately, Atkore also completed a $373 million loan refinancing, which extended its debt maturity to 2032.
Atkore is down 21.2% since the beginning of the year, and at $64.16 per share, it is trading 38.6% below its 52-week high of $104.45 from November 2024. Investors who bought $1,000 worth of Atkore’s shares 5 years ago would now be looking at an investment worth $2,788.
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