Contributed by: kellyseal on Monday, January 22 2024 @ 08:22 am
Last modified on Monday, January 22 2024 @ 08:30 am
Shares of Match Group rose as much as 12 percent after The Wall Street Journal reported that Elliott Management had invested almost $1 billion in the company.
According to the report, Elliott has a long history of success in tech investments, including in Salesforce and Pinterest. The Match Group investment showed signs of promise to investors who have recently shied away from dating app companies in the wake of decreasing revenues and management turnover. As a result, share prices for Match rose as high as 12 percent and ended the day up 3 percent.
According to CNBC[*1] and The Wall Street Journal, Elliott plans to engage with Match Group’s management, but it is unclear as to how involved they will be, and if that would include nominating its directors. Match Group recently appointed a new CEO for Tinder, so Tinder’s previous acting CEO Bernard Kim can focus his attention on Match Group’s entire suite of apps, which include Hinge, OkCupid, Match and BLK.
Elliott seems bullish on the dating app market, and specifically on Match Group which has experienced a lot of changes in its executive suite since 2012. The company also weathered a lawsuit brought by former Tinder founder Sean Rad and ex-employees of Tinder. Former Tinder CEO Gregg Blatt also faced a lawsuit from a former Tinder employee alleging sexual misconduct, which was settled out of court. Match Group dismissed Renate Cyborg a couple of years ago from Tinder’s top position, and new CEO Faye Iosotaluno is taking over for Kim.
Most recently, Match Group was involved in an antitrust lawsuit with Google over its Play Store practices, specifically the commission it was charging Match Group’s customers making in-app purchases. Match Group settled out of court in 2023.
Third quarter earnings were disappointing for Match Group, and the fourth quarter revenue outlook also missed expectations, in part due to a decline in paying users for Tinder. Hinge however is a rising star for the company, and its user base and paying customers continue to grow.
Neither Elliott nor Match Group commented on the investment, but a spokesperson for Match Group told CNBC that Match “regularly engages with investors, and will continue to work to create great experiences for our users and value for our shareholders.”
In addition to Salesforce and Pinterest, Elliott has also found success with Phillips 66 and wireless infrastructure company Crown Castle (where according to CNBC, it ousted the company’s CEO).