Harmonic rises as activist investor pushes for sale

Investing.com -- Harmonic Inc. shares rose Monday, currently up around 1.6% following pressure from activist investor Ancora Holdings Group, which has called for the company to explore strategic alternatives, including a potential sale.

The firm, a significant shareholder in the broadband technology company, released a presentation outlining what it sees as an opportunity for near-term value creation.

"Ancora sees an attractive alternative path for Harmonic (NASDAQ:HLIT) shareholders: a strategic review aimed at a value-maximizing sale that would likely attract significant acquirer interest," Ancora said in its presentation.

The investor group claims Harmonic’s stock, currently trading around $12, is undervalued due to poor investor communication and believes the company could command a price of approximately $20 per share in a sale to a well-capitalized buyer.

Ancora specifically highlighted Ciena (NYSE:CIEN) Corporation as a potential acquirer. They stated: "There is a clear opportunity for Harmonic to attract interest from well-capitalized acquirers, such as Ciena Corporation."

In its presentation, Ancora emphasized Harmonic’s strong financials, innovative products, and market leadership but expressed concerns that the company is trading at a depressed multiple due to ineffective communication and underwhelming recent results.

“The Unrealized Value Creation Opportunity (SO:FTCE11B) at Harmonic” presentation urges the company’s refreshed board to evaluate its standalone growth prospects against the potential value that could be unlocked through a sale.

Ancora has called for shareholders to share their views ahead of Harmonic’s 2025 Annual Meeting of Shareholders, underscoring the urgency of the situation.

Harmonic has yet to respond publicly to Ancora’s demands, but the investor’s push has placed the company under the spotlight, with market participants speculating on the likelihood of a strategic transaction.