Dye & Durham Ltd. DND-T announced the appointment of a permanent chief executive officer Monday, more than five months after an activist investor campaign led to an overhaul of the board and the departure of CEO Matt Proud.
The Toronto legal software company said George Tsivin, senior vice-president and general manager of software and corporate markets and strategy with LexisNexis Legal – and before that chief product officer with Nielsen – will lead an overhauled management team. Former D&D chief financial officer Avjit Kamboj is returning to the post, taking over from Frank de Lisio, while Nikesh Patel, another former Nielsen executive, is joining as chief product officer, replacing Scott Bleasdell.
Board chair Arnaud Ajdler – whose New York hedge fund Engine Capital led the successful activist campaign last year, said in a release: “After an in-depth and diligent search, we have assembled a world-class leadership team to guide the company through its next chapter.” He called Mr. Tsivin, a Harvard Law School graduate and one-time McKinsey consultant, “a results-driven leader with global experience accelerating growth and transforming underperforming software assets into high-impact, market-leading business units, while demonstrating a customer-first approach.”
The move comes as Mr. Proud continues to agitate for change, despite receiving a $10-million severance payment after he agreed to step down last fall after becoming a lightning rod for investor discontent. His holding company Plantro Ltd., D&D’s largest shareholder, blasted the board in a release Monday for the company’s financial performance, a sharp selloff in its stock price this year and for refusing to engage with prospective buyers – including Plantro.
Mr. Tsivin becomes the third CEO of the company after board chairman and interim CEO Hans Gieskes abruptly stepped down from those roles in February, two months after the dissident slate of which he was a part swept into power. He was replaced on an interim basis by another fellow director, Sid Singh.
Other senior leaders have departed recently, including the company’s chief operating officer, its global vice-president of operations and marketing and the vice-president in charge of Canadian sales. This year the company has reported two straight quarters of financial results that came in below expectations.
“This is a company in chaos,” Mr. Proud said in a text message. “The decision to terminate half of the executive team in a single day highlights deep governance dysfunction. At this point the best thing for shareholders is to sell the business.” He believes the company should attract bids of greater than $20 a share, about double its current level.
Mr. Tsivin lacks CEO experience but has led turnarounds, and oversaw a division at LexisNexis that was larger than D&D. Matt Proud’s brother, Tyler Proud, whose holding company is a large shareholder, was also involved in the search process that led to Mr. Tsivin’s hiring. Tyler Proud was among those investors pressing for change, and for his brother’s departure, prior to the changeover last December.
CIBC analyst Scott Fletcher said in a research note the board’s decision to “fully turn over the leadership team after a contentious activist fight makes sense, and bringing back a former CFO that is familiar with the business manages some of the change-management risk that comes with replacing the CEO and CFO at the same time.”
Mr. Kamboj was D&D’s CFO from October, 2019, through May, 2022, during which it went public and made several acquisitions, Mr. Fletcher noted. Mr. Kamboj subsequently served as CFO of Converge Technologies, another consolidator that sold to H.I.G. Capital this year, and his experience there “makes strategic sense” if a sale of D&D is on the table, Mr. Fletcher added.