Two investors urge career Website company DHI to go on the block

[June 16, 2015]  By Svea Herbst-Bayliss

BOSTON (Reuters) - Two activist investors on Monday urged DHI Group Inc, which offers specialized career websites, to sell itself and said they had already spoken with potential buyers.

Barington Capital Group LP and Ancora Advisors LLC said DHI, formerly Dice Holdings, lagged behind its peers but could perform better under new management.

"A sale of the company to a strategic or a private equity buyer is the best way to maximize value for all shareholders," Barington's James Mitarotonda and Ancora's Fred DiSanto wrote to DHI Board Chairman Peter Ezersky in a letter dated June 15.

"Our discussions with potential strategic and private equity buyers indicate that there are likely to be numerous parties interested in acquiring DHI at a premium to the company's current stock price," the pair said in the letter.

Officials at Barrington declined to provide any details on the potential buyers.

Jennifer Milan, the company's director of investor relations, acknowledged the letter had been received but declined to comment on it.

The company said last week it would update investors on its strategic initiatives at an investor day event scheduled for Tuesday.

DHI's share price was trading at $9.06, down 0.98 percent, on Monday, with the broader stock market also lower. Since January, DHI has lost roughly 10 percent of its value.

Barington and Ancora are working together to push for change and said they jointly own about 4 percent of DHI's stock.

Other large investors include Sterling Capital Management LLC, Oak Ridge Investments LLC, Dimensional Fund Advisors LP and ClearBridge LLC.

The two investors said the company's Dice.com technology and engineering site didn't offer substantive job postings from Google, Uber or Facebook and were under-represented in terms of jobs in the high-growth Silicon Valley market.

The investors also said DHI's $186 million in stock buybacks failed to boost the share price.

"We believe the ineffectiveness of stock buybacks to create value for shareholders is primarily due to management's inability to capitalize on opportunities for organic growth," the letter said.

Barington has returned roughly 12 percent this year, beating the average hedge fund's 5 percent return.

(Reporting by Svea Herbst-Bayliss; Editing by Alan Crosby and Bernadette Baum)

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