According to the Wall Street Journal, activist investor Starboard holds a stake of over 6.5% in Match, the owner of Tinder, and is urging for a potential sale if efforts to turn the company around are unsuccessful. Following this news, Match’s shares surged more than 8% during pre-market trading on Tuesday. Starboard believes that Match should work on improving Tinder, which generates more than half of the company’s total revenue, and sees potential opportunities for its subsidiary, Hinge, as well as other emerging dating apps. If Match fails to implement these changes, including more aggressive share buybacks, Starboard suggests that the company should consider going private. In response, Match expressed its commitment to the growth of Tinder and the expansion of Hinge. The company also stated its willingness to maintain an open dialogue with all investors, including Starboard.
Starboard did not respond immediately to a request for comment from Reuters.
In March of this year, activist investor Elliott pushed for improvement in Match’s performance and appointed Laura Jones, an executive at Instacart, and Spencer Rascoff, co-founder of Zillow, to its board.
According to Bloomberg News, investment firm Anson Funds Management also acquired a stake in Match and urged the company to refresh its board.
Match, which offers dating apps such as Tinder, Hinge, and OkCupid, has been facing challenges with declining revenue as users reduce discretionary spending in an uncertain economy.
Reporting by Urvi Dugar in Bengaluru. Additional reporting by Kanjyik Ghosh and Shreya Biswas. Editing by Alan Barona.