Shares of IAA Inc. surged 5.3% toward a fifth-straight gain in morning trading Tuesday, after activist investor Ancora Holdings Group LLC urged fthe vehicle auctions company to change its leadership or seek a sale. In a letter to IAA's board, Ancora said given IAA's underperformance versus its peers and the broader market, "the status quo cannot persist," and believed the board should replace Chief Executive John Kett with someone "more dynamic and equipped to reinvigorate the organization." AAI's stock has tumbled 35.7% over the past 12 months, while shares of rival Copart Inc. have gained 7.3% and the S&P 500 has advanced 5.9%. Ancora said if the board is "unwilling to act with urgency" to improve leadership, "it should run a formal sales process to sell the company." Ancora, which owns about a 2% stake in AAI, said it believes AAI could be bought out for $55 a share or more, which represents a premium of at least about 44%. " At this point, a sale seems like the best risk-adjusted path forward for stockholders," Ancora's letter said. The stock has now run up 18.5% over the past five days, since it closed at a 23-month low of $32.28 on March 8.
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