Struggling fintech vendor S1 Corporation has caved in to investor demands to put itself up for sale by agreeing to explore "strategic alternatives to maximise shareholder value".
A group of investors led by New York-based Ramius Capital which collectively own a 7.2% share in S1 called for the sale of the business last month.
In a letter to S1 chairman and CEO James Mahan, the group said the company has underperformed its peer group, with revenues and operating performance continuing to decline despite significant capital investment. The group argued that a sale of the business could achieve a higher return to shareholders than a stand-alone public market valuation.
S1 initially rejected the rebel demands in favour of following a new business plan focussed on long-term shareholder gains.
But in today's statement, the vendor says it has resolved its proxy dispute with the dissident investors - inviting Jeffrey Smith, a managing director of Ramius Capital Group, to join the S1 board of director - and retained Friedman, Billings, Ramsey Group and law firm Hogan & Hartson to explore "strategic alternatives to maximise shareholder value".
S1 says no assurance can be given that any transaction will be entered into or consummated as a result of the review.
The vendor also agreed to amend its bylaws to restore the right of stockholders owning 10% of the outstanding shares of common stock to call a special meeting.
As a result of the settlement, Ramius Group has agreed to withdraw a notice of its intention to nominate directors and make other shareholder proposals at S1's annual meeting.