Angie's List (ANGI - Get Report) continues to face pressure from its activist investor to explore strategic options after rejecting a buyout offer from Barry Diller's IAC/InterActiveCorp  (IACI) .

New York hedge fund TCS Capital Management President Eric Semler, in a letter included in a 13-D filing Monday, urged Angie's List Chairman John Chuang and the company's board of directors to hire a financial adviser to explore IAC's offer or any other strategic alternatives.

Semler warned the hedge fund won't hesitate to take any and all actions to protect shareholders' interests and rights.

"It is difficult to understand why the board is determined to ignore IAC and shareholder demands for a sale in favor of making a risky bet on the company's new CEO and his unformed, so-called 'Profitable Growth Plan,'" he wrote, referring to the plan that was announced during the Indianapolis subscription-based review company's third-quarter earnings in September. That plan is expected to be unveiled at the company's Investor Day next quarter.

TCS Capital, which owns a 9.6% stake in Angie's List, has been pushing for a merger between the company and IAC's HomeAdvisor since October. The hedge fund initially revealed a 5.4% stake in July.

In mid-November, New York-based IAC made a public proposal to acquire Angie's List for $8.75 per share, or $512 million, in cash. The media giant, which has a $5.58 billion market capitalization, on Nov. 11 said it prefers to acquire Angie's List via an all-cash deal, but that it's also open to considering a combination between HomeAdvisor and Angie's List through a tax-free reorganization.

Five days later, Angie's List said its board had unanimously rejected IAC's bid, arguing it's premature to conclude that a transaction would be in the best interests of shareholders, particularly in light of the company's Profitable Growth Plan that has yet to be executed. 

Semler wrote in the Monday letter that Angie's List does not have the luxury nor the license to gamble when it has a concrete offer from IAC, adding the company appears to have no intention of pursuing a combination with IAC's HomeAdvisor.

"As a long-time shareholder of [Angie's List] even before it was a public company, I can assure you that this is not the first time the board and senior management have become prematurely and unduly excited about a new product and plan," he said.

The activist also revealed Monday that Angie's List has offered him a board seat, which he declined.

"The addition of one shareholder representative to the board is clearly insufficient given the board's refusal to depart from the status quo or to consider the IAC proposal," Semler argued, adding that he will seek to effect change from outside the boardroom for now.


Some sources familiar with the situation have suggested IAC's $8.75-per-share offer is unlikely its best and final bid.

Others have said Angie's List is committed to prioritizing its Profitable Growth Plan while IAC has a strategic imperative to find a new source of growth after its initial public offering of online dating asset, Match.com.

The board of Angie's List strongly believes new CEO Scott Durchslag will execute his plans and wants to give him the time to prove himself, said a source familiar with the situation who asked for anonymity.

"They're hoping and wishing that a new guy that's unproven would take you to the promised land," this person said Monday of the board, adding that IAC could also become more aggressive in its pursuit of Angie's List by offering a higher price or even taking a stake.

The source further explained there continues to be a shared sense of frustration among current shareholders and their lack of representation in the strategic path of Angie's List.

But not everyone is impressed by IAC's offer.

"InterActive is not a company that has historically paid big premiums for their acquisitions," said Kerry Rice, a senior analyst at Needham & Co. While the $8.75-per-share offer probably isn't the suitor's final offer, Rice said he doesn't expect IAC to come back with an offer that values Angie's List at $11 per share or higher.

"Where it's trading might preclude them from coming back," he added, pointing to the company's stock price, which has shot up more than 25% since IAC's proposal. Shares of Angie's List closed Monday at $10.81, up 73.5% for the year to date and with a $632.57 million market capitalization. 

There are other companies that would be a good fit for Angie's List, but it's unlikely another bid will come at this point, Kerry said, citing Groupon (GRPN - Get Report) , Amazon.com (AMZN - Get Report) , Home Depot (HD - Get Report) and Lowe's (LOW - Get Report) as potential suitors. Industry sources have also pegged Yelp (YELP - Get Report) and Japan's Rakuten (RKUNF) as possible buyers of Angie's List.

Although Rice did not rule out the possibility of a transaction between IAC and Angie's List, he said the consumer review site is more likely to stay the course as a standalone company. "I would characterize Angie's as a show-me story," he said. "I think they need to make the investments to innovate more rapidly."

Still, if Angie's List received an offer with more than a 20% premium to its current trading price, the company would have to seriously consider the proposal, Rice acknowledged.

Officials with Angie's List and IAC didn't return requests for comment Monday.