Dec 2 (Reuters) - ACI Worldwide Inc should consider
selling itself to maximize value as the payments industry faces
consolidation, activist investor Starboard Value said on
Starboard, one of ACI's largest shareholder with a roughly
9% stake, asked the company to hire advisers and conduct a sale
process one month after management presented conservative
revenue growth and margin targets at its investor day.
Starboard said management's long-term plan may create value,
but that it would take too long and could be too risky to
justify plans for ACI to remain a standalone company.
"If this new guidance is really the best that you can do
over the next three years, then we believe that a sale of the
Company is clearly a more attractive option for shareholders,"
Starboard wrote to ACI, in a publicly released letter.
Shareholders reacted to Starboard's increased pressure by
pushing ACI's shares up roughly 11% to $36.91.
The company said it is "operating with a sense of urgency to
maximize profitability, approach operations with renewed cost
discipline, and identify all opportunities for compelling growth
and value creation." A spokesman also said ACI has active
communications with shareholders and that it is making
"substantive progress in executing (its) three-pillar strategic
Two months ago Starboard called ACI an "attractive" takeover
candidate, adding that it has underperformed peers including
Blackbaud Inc, Commvault Systems and FireEye
M&A activity in the payments sector has accelerated over the
last years as companies need scale amid the increasing
complexity and technology requirements of ecommerce. Last month
European payments processor Nexi SpA said it would buy Net A/S
from a group of private equity investors.
ACI itself may have been approached by potential buyers in
the past, Starboard said.
Starboard, which won 17 board seats at four companies in the
first half of 2020, has until early March 2021 to decide whether
it wants to nominate directors.
(Reporting by Noor Zainab Hussain in Bengaluru and Svea Herbst
in Boston; Editing by Kirsten Donovan and Leslie Adler)