Engine Capital Urges EPAM Systems to Boost Buybacks or Sell

Engine Capital is urging software firm EPAM Systems to expand its share buyback program or explore a sale of the company. The activist hedge fund, which holds a 1.5 percent stake in the firm, is responding to a significant decline in EPAM's stock price, which has fallen approximately 44 percent this year due to investor concerns over AI disruption.

Arnaud Ajdler, managing partner of Engine Capital, called on the board to utilize a $750 million cash reserve, future free cash flows, and debt to fund the buybacks. Ajdler suggested that if these measures are not pursued or fail to improve performance, the company should initiate a formal strategic review led by independent directors and financial advisers.

Neither EPAM Systems nor Engine Capital has issued a formal comment on the proposal.