The Carlyle Group via subsidiary Axios Bidco will offer 61 cents a share for the publicly traded company in the deal announced Tuesday, a 13.5 percent return on the 54-cent share price Thursday and a 42.1 percent gain over the six-month share average price of 43 cents. The company’s market cap on Thursday was nearly $663 million.
Bidco had locked up 28.3 percent of the Innovation Group’s shares as of Friday through letters of intent or irrevocable pledges, and the Innovation board has voted unanimously to recommend shareholders take Carlyle’s offer.
“The group has achieved much and created significant value since the management team, led by Andy Roberts, took over the leadership of the business in 2009,” Innovation Non-Executive Chairman David Thorpe said in a statement Monday. “Carlyle’s offer represents a compelling opportunity for Innovation’s shareholders to immediately and fully realise the value from their investment, in cash and at a premium. We also believe that Carlyle brings a commitment and vision to the ongoing investment requirements of the business, providing Innovation with enhanced financial and operational flexibility as the group seeks to execute its strategy in the longer-term. We believe this also makes the transaction compelling for our non-investor stakeholders as well.”
Innovation said directors felt that while shares could continue to grow, investors should still cash out now and allow Innovation to realize the benefits of Carlyle. Those included the bidders’ “global presence, relevant industry network” and deep pockets for acquisition, growth and “scaling the Software division.”
“Innovation is a high-quality business with great potential for growth, both organically and through acquisitions. Carlyle shares the management team’s vision for growth and international expansion, and we believe our partnership will strengthen the business,” Carlyle Europe Partners Managing Director Eric Kump said in a statement.
Fellow Managing Director Zeina Bain said Carlyle was “excited” to achieve Innovation’s potential “through leveraging Carlyle’s experience and global ‘OneCarlyle’ network.”
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