Latest news with #DyeDurham
Bloomberg
2 days ago
- Business
- Bloomberg
Dye & Durham's Ex-CFO Urges Sale After Stock Drops, Debt Mounts
A former senior executive and shareholder of Canadian technology firm Dye & Durham Ltd. is asking the board to consider a full sale of the company, citing a plunge in shareholder value and growing competitive pressures. Ronnie Wahi, who was chief financial officer until 2018, criticized the company's strategic direction in a letter sent to directors on Thursday, saying nearly C$1 billion ($740 million) in equity value has been lost under the current board.
Globe and Mail
4 days ago
- Business
- Globe and Mail
Dye & Durham angered customers after buying Teranet unit and hiking prices. Now, Teranet wants to win them back
Dye & Durham Ltd. DND-T faces growing competition for its core Canadian business, which observers say is due to the Toronto real estate software firm's former free-wheeling acquisition strategy and aggressive price hikes that angered customers and created opportunities for rivals. In April, Ontario land registry services giant Teranet Inc. bought control of ReadyWhen Tech Inc., a B.C. startup that launched its GoVeyance software for processing real estate transactions (known as conveyancing) after competitor D&D hiked prices for its service in its province by up to 563 per cent in November, 2021. ReadyWhen has 200 real estate law firm clients in B.C., many of them former D&D customers. Teranet announced Wednesday that it would expand GoVeyance to Ontario. It marks a return to the business for Teranet, owned by the Ontario Municipal Employees Retirement System. In December, 2020, Teranet sold its conveyancing software business, DoProcess LP, to D&D. which paid $530-million, an exorbitant 24 times operating earnings. D&D promptly hiked prices by more than 400 per cent in Ontario. 'Five years ago, we were presented with a unique and compelling business opportunity' to sell DoProcess, at a 'richly valued' price, Teranet chief executive officer Elgin Farewell said in an interview last week. 'It was an imminently rational business decision.' By 2022, Teranet wanted back in, but had to wait until its non-compete agreement ended. The goal, Mr. Farewell said, is for the company to repeat what it did after buying DoProcess in 2008: turn a small vendor into a national player. 'It's a compelling opportunity for us,' he said. Dye & Durham names LexisNexis veteran as CEO as predecessor pushes for sale of company Another rival, LawLabs Inc. of London, Ont., sold in May, 2023 to Australian real estate software giant ATI Global Ltd. ATI-N, a year after launching its Convey software in Ontario in response to D&D's price hikes. LawLabs now has more than 500 customers and recently started cross-selling with ATI's Leap legal practice management software (D&D is suing LawLabs for copyright infringement). D&D's price action 'brought folks into the space that might otherwise have no business doing that,' LawLabs CEO Harrison Kelly said in an interview Tuesday. 'Canada is home to several legal tech companies' that compete with D&D, said the company's new CEO, George Tsivin, in a e-mailed statement Tuesday. 'While many of these competitors offer lower prices, they often provide less value and fewer software capabilities. Our software stands out in quality, and with our renewed focus on customer satisfaction and product innovation, we are confident that we will maintain our leadership position.' D&D's conveyancing software business, which accounts for an estimated 30 per cent-plus of operating earnings, 'is probably the key area of concern right now for investors' owing to competition and real estate market weakness, said BMO Capital Markets analyst Thanos Moschopoulos said in an interview this week. 'Clearly they had been too aggressive in the past with regard to pricing and contract terms. It's a meaningful potential threat when you have a company like Teranet backing an emerging competitor.' D&D has been attempting to transform its image since the departure of former CEO, Matthew Proud. On his watch, the company expanded aggressively with a string of acquisitions and sharp price hikes. The DoProcess deal gave D&D, which had previously bought three other Canadian conveyancing software providers, a market stranglehold in several provinces, and it quickly hiked prices. D&D even broke a promise to DoProcess's Ontario customers to freeze prices for three years after the first hike, increasing them again to $249 in 2022 (from $25 before it bought DoProcess) for any customer that wouldn't lock into a three-year contract. Despite their opposition, D&D customers ultimately pass on higher fees to their clients. The company's actions didn't just make customers unhappy. Its debt-fuelled acquisition binge and other issues raised the ire of investors who pushed for changes at the board and management, culminating in Mr. Proud's departure and the election of a new board put forward by activist hedge fund Engine Capital in December. Engine promised to restore trust between D&D and customers by offering better service, new pricing tiers and to keep further price increases to a minimum. In April, interim D&D CEO Sid Singh wrote to clients recognizing 'that we haven't always been the best partner, and we understand it will take time for you to see that our words are backed by concrete actions,' according to an e-mail obtained by The Globe and Mail. Mr. Singh promised the company would offer more flexible terms and explore 'new and better approaches to pricing,' an issue given that some firms committed to a set number of transactions to lock in lower prices – but have not had the volumes to justify the rate. GoVeyance was founded in 2020 by Jessie Vaid, a B.C. notary, to build software for people to store essential information to aid the probate process after they die. After D&D's B.C. price hikes in November, 2021, Mr. Vaid said 'my colleagues reached out and said, 'Jessie, can you help us out? We don't want to be tied to a product that doesn't allow us to hear our voice.' The mind started racing and we thought, 'How can we build something my colleagues would be interested in?'' Mr. Vaid sold his practice in 2023 to focus on GoVeyance. The company charges $100 per file to B.C. clients, well below D&D's rate. It hasn't yet set pricing for Ontario. Mark Giavedoni, real estate committee chair with the Federation of Ontario Law Associations, said in a statement Tuesday that 'more competition in the real estate technology is welcome.' But given past consolidation and subsequent price hikes, he said, 'lawyers are leery of trusting these players for fear of this happening again.'
