Irenic Capital Management has built a meaningful holding in Ralliant and is urging changes intended to improve the Raleigh, North Carolina-based precision technology company's performance, according to two sources with direct knowledge of private discussions.
The New York-based activist hedge fund owns roughly 2% of Ralliant, which has a market value of about $4.7 billion, and has met repeatedly with the company's management to press for strategic steps, the sources said. A company representative was not immediately available for comment.
At the center of Irenic's push is a demand for a larger and faster program of share repurchases. Ralliant's board last year authorized up to $200 million for buybacks, and management reiterated in early February - when reporting results - that that authorization "remains fully available." The sources said Irenic believes the company could announce a bigger repurchase plan and move to an accelerated share repurchase approach, a contract-based method that permits a firm to buy a large block of its own stock quickly.
In addition to advocating for quicker buybacks, Irenic is pressing Ralliant to tighten day-to-day operating costs. The push is a response to recent guidance moves: the company surprised markets by twice increasing its forecast for costs, citing merit increases and other employee-related expenses, the sources said.
Strategic focus is another element of Irenic's agenda. The hedge fund wants Ralliant to concentrate more heavily on its sensors and safety systems business, which the sources said accounts for about 80% of the company's earnings. Ralliant's test and measurement segment constitutes the remainder. Irenic has privately told other investors and the company that the two businesses do not make a coherent long-term combination, according to the sources.
Industry analysts cited by the sources have noted that the volatility inherent in the test and measurement business has weighed on Ralliant's overall results. The company s stock has fallen about 20.5% since Ralliant was spun out of the industrial conglomerate Fortive less than a year ago. In early February, shares plunged roughly 30% after investors reacted to signs that future costs would be higher than anticipated.
The sources said Irenic, co-founded by Adam Katz and Andy Dodge, has suggested that the test and measurement operations might be a better fit with other engineering and industrial companies. They pointed to competitors such as Emerson Electric, which purchased National Instruments in 2023, as examples of firms that have absorbed similar businesses.
At the same time, Irenic reportedly sees durable growth potential for Ralliant's sensors and safety systems business. The fund expects that segment could sustain high-single-digit growth for several years, driven by secular trends the sources described as the rebuilding and upkeep of the U.S. electrical grid and increased investment in missile defense systems.
Ralliant's portfolio includes Qualitrol, a subsidiary that makes sensor components used to monitor utility electrical assets such as power plants, transformers and transmission towers. Another unit, Pacific Scientific EMC, produces pyrotechnic components for missiles and space systems.
Irenic has a track record of investing in aerospace and defense-related companies and of advocating for separations or sales that carve businesses into more-focused entities. The sources noted a precedent in Barnes Group, where Irenic urged changes and the company subsequently sold to private equity firm Apollo in early 2025.
Context for markets and sectors
- Defense and aerospace suppliers - Irenic's focus and Ralliant's missile and space systems business place these sectors squarely in view.
- Utilities and grid infrastructure - demand for sensor components used to monitor electrical assets ties Ralliant to utility spending and grid maintenance trends.
- Industrial test-and-measurement - the volatility of this business has contributed to recent stock weakness and is central to debate over strategic fit.