The offer of 313p per share from Scarlet Bidco has been agreed to by the Board, representing a 19.8% premium to yesterday's price.
Companies: Servelec Group
Software company Servelec (LON: SERV) has announced today it has agreed to the terms of an offer from Scarlet Bidco to take the company private. The £223.9m cash offer represents a 19.8% premium to yesterday's closing price of 261.4p.
It also represents a premium of 27% to the average share price for the three months to November 22. The offer is conditional to approval from shareholders and the Courts.
Servelec provides software, hardware and services to the healthcare, education, oil and gas, energy and utility sectors and has been public since December 2013.
Commenting on the offer and the Group's performance since it listed, Chairman and Non-Executive Director of Servelec Richard Last said:
"Servelec Group has made good progress in the four years since its IPO, growing both organically and through acquisition. The offer from Montagu represents an attractive and certain value, in cash, today for our shareholders. Investors who invested at the IPO will have achieved a total return of approximately 185% on that investment, including dividends."
The offer comes just over two months since the Group warned its order book had dropped as customer deferred their orders for its "Technologies" operations.
Corporate broker N+1 Singer released a note off the back of the announcement, saying:
"Given the short-term challenges the group currently faces, this looks a decent outcome but is by no means a knockout. We wouldn't rule out a counter and continue to believe a combination with EMIS (for example) makes a lot of strategic sense."
Consensus forecasts the Group to make a Net Profit of £13.5m from Revenues of £66m in FY17, up from the £10m and £61m in FY16 respectively.
