Monitise board recommends acceptance of Fiserv acquisition terms
The boards of Fiserv UK Ltd. and Monitise PLC have agreed to the terms of an increased and final recommended cash offer for Monitise.
The announced deal increases the initial offer by Fiserv, which some Monitise shareholders thought was too low.
The increased and final offer price values the entire issued and to-be-issued share capital of Monitise at approximately 75 million pounds ($97.7 million) and represents a premium of approximately:
- 34.8 percent to the closing price of 2.30 pounds ($3) per Monitise share on June 12, the last Business Day prior to the Initial Offer Announcement);
- 32.8 percent to the volume-weighted average closing price of 2.34 pounds ($3.05) per Monitise share for the three-month period ended June 12; and
- 59.6 percent on a cash-adjusted basis to the closing price of 2.30 pounds ($3) per Monitise Share on June 12, adjusted for reported June 30 cash balances of 22.2 million pounds ($28.9 million).
According to a press release from Fiserv, " … Fiserv firmly believes that the increased and final offer constitutes full and fair value for Monitise given the financial outlook for the group and the structural challenges that the group faces."
The Fiserv release named challenges that include:
- continued decline in revenue that outstrips cost-cutting initiatives;
- the Monitise board's belief that were the acquisition not to take place, the board would need to consider raising further capital, divesting businesses, and the revising the overall strategy of the group;
- pending changes to U.K. corporation tax law would further disadvantage the business; and
- Monitise has now been in a public offer period since June 13 without a third-party offerer or potential offerer emerging.
According to the release, Monitise directors unanimously recommended acceptance of the offer and reiterated their belief that strategic alternatives to a takeover are accompanied by significant execution risk and are unlikely to yield superior value to the acquisition.