Mitek Systems Rejects Offer From Elliott Management, ASG Technologies

Mitek Systems, the financial technology provider to banks, is pushing back from a takeover offer from Elliott Management, the hedge fund and ASG Technologies, the software company.

Reuters, citing people familiar with the matter, reported Wednesday (October 11) that Mitek has rejected the offer because it prefers to remain independent. It comes as the company is in a state of flux after it said in August its Chief Executive Jim DeBello and Chief Financial Officer Jeff Davison were leaving the company either to retire or pursue other things. DeBello has been with Mitek for 23 years, serving as its CEO for 15 years and chairman of the board for two years. DeBello helped Mitek become a leading provider of Mobile Deposit and Mobile Verify ID verification, and also played a key role in the company’s listing on NASDAQ. In addition, he successfully expanded Mitek’s product offerings with three global acquisitions and over 50 patents, five of which he holds as co-inventor of Mobile Deposit.  CFO Davison will depart at the end of November to join a firm near his home in Bozeman, Montana. His resignation is unrelated to DeBello stepping down.

ASG first made an offer during the summer, valuing Mitek at what Reuters said was a “significant premium,” but the offer was rejected. In a letter last week to Mitek’s board, ASG urged it to consider merger talks. The report noted the price of the offer hasn’t been learned.  Reuters noted that last year ASG received an investment from Evergreen Coast Capital, the private equity arm of activist hedge fund Elliott Management. ASG is aiming to expand its offering of software products for banks via an acquisition of Mitek. It also wants to increase the development of Mitek’s technology that helps banks verify the identities of customers. Mobius, the ASG software platform, currently helps banks store data to comply with regulations. Sources said ASG has annual revenue of about $250 million.