Shares of Acadia Healthcare Company (NASDAQ:ACHC) rose 5% on Wednesday after the Financial Times reported that activist investor Engine Capital has acquired a stake in the mental health services provider.
The report indicates that Engine Capital now holds roughly 3% of Acadia’s shares and is advocating for major corporate changes amid ongoing federal investigations. In a letter to Acadia’s board reviewed by the Financial Times, the hedge fund called for a refresh of the board, a portfolio assessment, and a pause on capital-intensive projects for new facilities.
Engine Capital criticized what it termed Acadia’s “growth at any cost” strategy, arguing that it has led to an overly complex corporate structure. The activist fund also highlighted that a 2022 reorganization created an “unwieldy management structure” that has impeded turnaround efforts.
The letter specifically recommended adding directors with expertise in behavioral health and capital allocation, stating: “It is stunning that Acadia’s board does not have a single director with relevant operating experience.” Engine Capital further urged the company to explore asset sales to raise cash for share buybacks, describing Acadia’s stock as “deeply undervalued.”
Acadia Healthcare Company stock price
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