Ideagen PLC (AIM:IDEA) said it continues talks with a second private equity firm despite reaching a £1.09bn (US$1.34bn) takeover agreement with rival private equity firm Hg Pooled Management.
Hg's Rainforest Bidco has agreed to a 350p per share cash offer, the AIM-listed software said.
Ideagen also issued a second statement confirming it is still in talks with French private equity firm Astorg.
Shares in the company soared 46.38% to 355.70p early Monday, above Bidco’s offer price, indicating that investors are expecting a counter offer from rival suitor Astorg.
The Bidco offer represents a 52% premium to Ideagen's closing price of 230p on April 11, the last trading day before speculation about an offer began.
In a statement, Ideagen’s board said "it remains in discussions with Astorg and that Astorg has been granted access to due diligence. There can be no certainty that a firm offer will be made by Astorg, nor as to the terms of any such offer. Further announcements will be made in due course.”
There has been a flurry of takeover interest since early April from companies interested in acquiring Ideagen, which sells regulatory and compliance software to over 8,000 companies in accounting and pharmaceutical firms.
Blue chip brands like Bank of New York, British Airways, Heineken and Johnson Matthey are among its customers.
Cinven, a private equity firm based in London, said on April 14 it was pursuing an offer for Ideagen, but dropped the pursuit last week.
Ideagen's board plans to unanimously recommend the Bidco deal to shareholders, with non-executive chairman Richard Longdon stating the offer "represents value for shareholders",
On the acquisition, partners at Hg said, "We strongly believe that the core of the business should be maintained in its Nottingham base, including its executive team and technological development centre."
The Hg/Rainforest deal values the entire issued and to be issued ordinary share capital of Ideagen at around £1.05bn, implying an enterprise value of £1.09bn, including debt.