Boston, MA 06/20/2014 (wallstreetpr) – Synacor Inc (NASDAQ:SYNC) is a provider of solutions for online content and services delivery. Two of the company’s shareholders with significant equity stakes want to have a say in the Board of Directors, capital structure and replacement of the chief executive officer.
In a joint regulatory filing, shareholders JEC Capital Partners and Ratio Capital Partners revealed their intention to seek representation in the Board of Directors of Synacor Inc (NASDAQ:SYNC) and also play a part in the search of the company’s new CEO. Each of the institutional investors with board seats ambitions hold a stake of 4.9 percent in the company.
Assessing The Factors
According the investors, depending on their assessment of various factors that hinge on the improvement of the company’s performance, they might seek appoint in the board of Synacor Inc (NASDAQ:SYNC), get involved in the ongoing search of a new CEO and offer help in the strategic direction of the company.
The company has already hired Mitchell James to conduct a search for a new CEO. The company’s current CEO Ron Frankel is expected to step down. He has been at the helm of the company since 2001. Although Frankel will exit his CEO position, he plans to stay on as an advisor to the board of the company.
Growing Pains
Since going public in 2012, when shares opened at $5.75 apiece, shares are down more than 51 percent as the company struggles with shrinking revenue. The company’s 1Q2014 financial results, released last month, lacked good news. The company saw its revenue down to $25.2 million from $29.1 million in the same period a year earlier. The impact on the revenue came from the lackluster performance in the display ad segment, which dropped to $19.9 million from $24.1 million. The decline in revenue culminated in a net loss of $2.1 million or $0.07 per share for the quarter.
It is, therefore, understandable why JEC Capital Partners and Ratio Capital Partners are interested in board seats in Synacor Inc (NASDAQ:SYNC).
