Nearly two months after Fidessa (FDSA) agreed the terms of its £1.4bn takeover by Swiss group Temenos (SW:TEMN), the sought-after software company has defected to a rival suitor. To re-cap, Fidessa recommended Temenos’s acquisition on 21 February, scheduling a shareholder meeting for 5 April to approve the deal. At the eleventh hour, two other potential bidders – Ireland-based Ion Investment Group and US-based SS&C – came forward. The Temenos vote was duly postponed to 27 April, to allow for these rival bids to be firmed up.
Swooping in at the last minute, Ion trumped Temenos with a whopping £1.5bn cash offer – hours before the UK Takeover Panel’s deadline of 5pm on 20 April. Under the terms of this new offer, each Fidessa shareholder will receive £38.703 per share and – subject to approval – dividends totalling 79.7p. This represents an 8.5 per cent premium to Temenos’s package of £35.67 plus dividends, and a whopping 48.6 per cent premium to Fidessa’s closing price of £26.05 on 16 February – the last business day before its shares climbed on news of the Temenos deal.
It’s perhaps unsurprising that Fidessa has transferred its recommendation from Temenos to Ion. Beyond the superior return for Fidessa shareholders, Ion says the proposed combination will “uniquely position the companies to drive innovation in trading technology and automation across all asset classes”. For Fidessa’s chairman, John Hamer, the two businesses are “highly complementary” – while Fidessa is a leader in equities and derivatives, Ion is a leader in fixed income and foreign exchange.
Key Fidessa investors have also backed the Ion acquisition. Lindsell Train, Evenlode Investment Management and Elliott International collectively own 25 per cent of the company’s share capital, and have all given irrevocable undertakings to accept the offer.
The shares edged slightly higher on the Ion news, with some perhaps hoping for a more generous proposal to emerge. But Temenos has since said it would not make a revised offer. For executive chairman Andreas Andreades, it was not in the interest of his company’s own shareholders to do so; he said that Temenos is “the leader in this winner-takes-all market”.
