Groveland Capital LLC, a shareholder of Donnelley Financial Solutions Inc., decried Donnelley's stock performance as "unacceptable" and urged the company's board to explore strategic alternatives.
In a letter to Donnelley's board, the investor said shares of the financial data provider have underperformed the broader markets since it became a public company in October 2016. "It appears that the market has lost confidence in the management team," Groveland said.
Recent M&A transactions in the financial services sector have been executed at significant premiums to Donnelley's current valuation, Groveland said, pointing to Intralinks sale to Siris Capital and SS&C Technologies Holdings Inc.'s acquisition of DST Systems Inc. as examples.
"It is our belief that [Donnelley's] stakeholders would be best served in pursuing the business plan/transition to SaaS currently underway as either a private company (outside of the public spotlight) or as a subsidiary of a larger complementary company, where top and bottom-line growth synergies could be achieved," Groveland said.
