BILL Holdings Surges 8% as Starboard Takes Activist Stake
Activist investor Starboard Value has acquired an 8% stake in the financial software firm and is reportedly preparing for a potential boardroom challenge.
Shares of BILL Holdings (NYSE: BILL) jumped more than 8% in after-hours trading after activist investor Starboard Value disclosed it has acquired a significant 8% stake in the company. The move signals a potential boardroom battle, as to nominate new directors and push for strategic changes at the financial automation software provider.
The investment comes at a challenging time for BILL Holdings, which has seen its stock price fall by nearly half since the beginning of the year and plummet 86% from its all-time high in November 2021. The company, which serves small and midsize businesses, has a market value of nearly $5 billion. In a recent move acknowledging its depressed valuation, the company announced a $300 million share repurchase plan in August.
Starboard Value, known for its active involvement in the technology sector, has a history of pushing for operational improvements and strategic shifts at its target companies. The firm may nominate as many as four director candidates ahead of the company's upcoming annual meeting. In its annual report, , noting that a proxy contest could divert resources and interfere with its ability to execute its strategy.
The activist pressure arrives amid a wave of consolidation in the financial technology sector. With several of BILL Holdings' rivals being acquired by strategic buyers and private equity firms, some analysts speculate that the company could itself become an attractive acquisition candidate. Starboard's involvement will likely intensify this speculation as investors watch for the firm's next move to unlock value for shareholders.