Minority investor pushes Dallas fintech firm to explore selling company

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A minority investor in Dallas-based financial technology firm Avantx Inc. is urging the company’s board of directors to consider selling the company. In a...

Activist hedge fund Engine Capital LP has encouraged several other companies it also owns shares of to consider selling.

Dallas-based Avantax, which changed its name from Blucora at the beginning of this year, provides tax-focused wealth management services and platforms used by small business owners, tax and financial professionals and accounting firms.A minority investor in Dallas-based financial technology firm Avantx Inc. is urging the company’s board of directors to consider selling the company.

In a Monday letter to the board, Engine Capital LP laid out 10 reasons why it thinks a sale now would boost shareholder returns by as much as 34%. Engine Capital argues a sale could net $27 to $32 a share for investors. The company’s stock has been trading around $22. “Avantax’s stock continues to trade at a meaningful discount to its strategic value. We believe this is primarily due to the fact that Avantax is a subscale asset in the consolidating asset management industry where size is increasingly important,” said the Engine Capital letter.

 

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