CHANTILLY, Va. – Hedge fund Tannenbaum Capital Partners, which has accumulated the largest ownership stake in Online Resources Corp., has initiated a proxy contest for three vacant seats on the board of the e-banking service provider where it will push for the sale or merger of the firm.
Shares in Online, which have sunk as low as $2.94 in recent trading, surged almost 5% yesterday to close at $3.25 after news of the proxy battle broke.
Tannenbaum, which has accumulated a 22% stake in Online, said its representatives would move to separate the CEO and chairman’s position, now occupied by Mathew Lawlor, in order to eliminate "any possibility of bias or undue influence" in potential mergers or acquisitions by Lawlor. It will also try to block the company’s efforts to enact a so-called poison pill that would dilute Tannenbaum’s stake if an entity were to make a hostile takeover offer for Online.
Tannenbaum’s three board nominees include John Dorman, the former CEO of Digital Insight; Edward Horowitz, the former CEO of SES Americom; and Bruce Jaffe, a former vice president at Microsoft.
