(Alliance News) - Brady PLC on Monday said it has agreed to a 10 pence per share cash takeover offer made by a vehicle of Hanover Active Equity Fund II Sca SICAV-RAIF.
Vehicle Hanover Acquisition Ltd's 10p per share consideration values trading, risk, and supply chain management software firm Brady's issued share capital at around GBP8.3 million.
The offer is 51% higher than Brady's Friday closing price of 6.63p and requires shareholder approval. The deal is also conditional upon no part of Brady becoming insolvent.
Shares in Brady closed up 2.7% at 6.80p in London on Monday, which would put the offer at a 47% premium to the firm's latest closing price.
In September, Brady said "it was advancing funding initiatives" to grant access to around GBP1.5 million needed to meet working capital requirement before November 30 in order "to support existing operations".
Brady confirmed Monday it "continues to review the position" and the GBP1.5 million is still required, with a "specific cash payment due on 15 November".
"The company is in discussions and would expect to be able to manage this situation until 30 November 2019. However, there can be no guarantee that this will be the case. The company confirms that, whilst negotiations in respect of funding options have been advanced and are on-going, the company has not, at this time, secured unconditional funding," said Brady.
If the offer does not go ahead or more funding does not become available before Brady needs further working capital, the offer may lapse and Brady shareholders risk "receiving no or little value".
Brady Non-Executive Chair Ian Jenks said: "The recent period has been a challenging time for the Company, and the board's priority has been to secure an outcome for shareholders, customers and employees that preserves value and provides a platform from which the business can flourish. I believe the Offer from Hanover provides certainty for all stakeholders along with the expertise and resources to best enable Brady to unlock its potential."
By Anna Farley; annafarley@alliancenews.com
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