Engine Capital Builds 3% Stake, Pushes Avantor Board Overhaul, Possible Sale

Engine Capital, holding approximately 3% of Avantor's shares, has urged Avantor's board to address operational inefficiencies, poor capital deployment, and weak cost controls, which they believe have caused the company's stock to trade at a significant discount. The investment firm advocates for refreshing the board with directors experienced in healthcare distribution, capital allocation, and leadership to unlock shareholder value. Engine Capital projects a potential 100% upside in Avantor's share price by 2027 through cost discipline, operational improvements, portfolio optimization, and share repurchases. Despite recent challenges, including a nearly 50% stock decline this year and earnings below expectations, analysts maintain an average target price suggesting over 20% upside, with brokerage consensus rating the stock as 'Outperform.' GuruFocus estimates an even higher one-year upside potential of nearly 75%, reflecting optimism about Avantor's future growth prospects. These developments highlight significant investor pressure on Avantor to improve governance and strategic direction to realize its intrinsic value.