BOSTON: Hedge fund Legion Partners Asset Management is preparing to nominate three directors to the board of SurveyMonkey parent Momentive Global Inc as a planned acquisition by rival Zendesk looks likely to fail, two people familiar with the matter said.
Three Momentive directors will stand for election this year and Legion would want to replace all of them, arguing the Momentive board breached its fiduciary duty by agreeing to be bought by Zendesk.
A Momentive representative did not immediately respond to a request for comment.
Bloomberg first reported news that Legion intends to launch a proxy contest at Momentive.
Legion, which oversees $500 million in assets and owns 1.4% of Momentive, last year urged the company to explore a sale.
Zendesk agreed to buy Momentive in October in an all-cash deal valued at roughly $4 billion. Investors, including activist hedge fund Jana Partners, quickly spoke out against the proposal, criticizing its financial merit and logic.
Earlier on Friday, proxy advisory firms Institutional Shareholder Services and Glass Lewis recommended that Zendesk shareholders vote against the takeover of Momentive later this month, making it highly unlikely that the deal will receive enough shareholder support to be finalized.
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