Temenos makes official £1.4 billion acquisition bid for Fidessa - FinanceFeeds

Temenos makes official £1.4 billion acquisition bid for Fidessa

The price of £35.67 in cash for each Fidessa Share values the entire issued and to be issued share capital of Fidessa at approximately £1.4 billion.

A follow-up to FinanceFeeds’ earlier article about Fidessa Group plc (LON:FDSA), a provider of trading, investment and information solutions to the financial services sector, and Temenos Group AG (SWX:TEMN), a Geneva-based software provider, being in advanced M&A discussions…

Today, the boards of Temenos and Fidessa announce that they have reached an agreement on the terms of a recommended all cash acquisition by Temenos, through its wholly-owned subsidiary, Temenos Bidco, of the entire issued and to be issued ordinary share capital of Fidessa.

Fidessa’s shareholders will be entitled to receive £35.67 in cash for each Fidessa share. This price values the entire issued and to be issued share capital of Fidessa at approximately £1.4 billion on the basis of a fully diluted share capital of 39,136,739 Fidessa Shares.

On top of that, Fidessa’s shareholders who are on the register of members of Fidessa as at close of business on May 11, 2018 or at close of business on the Business Day prior to the Effective Date (if earlier), will be entitled to receive and retain a final dividend and a special dividend in respect of the year ended December 31, 2017 together amounting to 79.7 pence in aggregate per each Fidessa share.

In aggregate, Fidessa Shareholders will receive £36.467 for each Scheme Share held by them at the Scheme Record Time comprising the cash consideration and the Dividend.

The price of £35.67 in cash for each Fidessa Share represents a premium of approximately 36.9% to the Closing Price of £26.05 per Fidessa Share on February 16, 2018.

The Temenos Board believes the deal offers a compelling opportunity to establish a global leader in financial services software, with a strong presence in all major financial centres and serving a blue-chip customer base. The combined business is expected to benefit from a larger addressable market, a broader product offering and deeper customer relationships.

The Enlarged Group is expected to have (on a pro forma basis):

  • Revenues for the year ended December 31, 2017 of more than $1.2 billion;
  • EBITDA margin for the year ended 31 December 2017 of 32.3%; and
  • A diversified revenue base with approximately 42% of sales for the year ended December 31, 2017 in Europe, 29% in the Americas, 20% in Asia Pacific and 9% in the Middle East & Africa.

In addition, the Temenos Board expects the deal to result in approximately $60 million per annum of run-rate pre-tax cost synergies, which are expected to be fully achieved within three years following the completion of the acquisition.

It is planned that the acquisition will be implemented by means of a Court-sanctioned scheme of arrangement under Part 26 of the Companies Act. In order to become effective, the Scheme must be approved by a majority in number of the Scheme Shareholders present and voting (and entitled to vote) at the Scheme Court Meeting.

The acquisition is subject to the satisfaction or waiver of a number of conditions, such as certain approvals by Fidessa Shareholders, the sanction of the Scheme by the Court, the receipt of anti-trust clearances from the relevant authorities in the US (or lapsing of the applicable waiting periods), the receipt of regulatory clearances from the Financial Conduct Authority and other customary conditions.

+ Read This Next