Monro ( NASDAQ: MNRO ) rose 2.5% after an investor called on the company's board to create a formal strategic review or resign.
Investor Ides Capital said the board should immediately create a formal strategic committee and the activist investor said that it's aware that parties have attempted to approach Monro ( MNRO ) to express their interest, only to be "rebuked" and told the company isn't for sale, according to a letter sent to the Monro board from Ides Capital.
If the board doesn't want to start a review "Monro’s independent directors could immediately submit notices of resignation in light of their inability to act as effective agents for common shareholders," Ides Capital Managing Member Dianne K. McKeever wrote in the letter.
Ides Capital contends that Monro ( MNRO ) trades at about a 30% discount to its public peers and trades at a "commensurate if not even more meaningful" discount to premiums paid by buyers of similar businesses.
The Ides Capital letter comes as the hedge fund has been trying to pressure Monro ( MNRO ) management since at least November 2020 to improve its returns and and change operations.
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Monro Inc. gains as investor pushes for strategic review