(Alliance News) - Sophos Group has agreed to a GBP3 billion takeover by US-based private equity firm Thoma Bravo LLC, the two announced on Monday.
Thoma Bravo has offered USD7.40, or 583 pence, per share. Cybersecurity company Sophos closed at 425.5p on Friday in London, meaning the offer price is at a 37% premium.
The price values Sophos, a member of the FTSE 250 index, at GBP3.01 billion, and gives it an enterprise value of GBP3.11 billion when including its debt.
Sophos listed on the London Stock Exchange in July 2015 with a 225p share price and GBP1.01 billion market cap.
"It is the view of the Sophos board this is a compelling offer for Sophos shareholders which secures the delivery of future value for shareholders today. Thoma Bravo has deep sector expertise in cybersecurity software as well as a long and successful track record of partnering with and investing in its portfolio companies to support long-term growth and success," said Peter Gyenes, chair at Sophos.
"Under Thoma Bravo's ownership, we expect Sophos to accelerate its evolution and leadership in next-generation cybersecurity. The Sophos board believes this recommended offer delivers a significant opportunity for all stakeholders, our shareholders, customers, partners, and employees."
Thoma Bravo, which manages funds worth over USD35 billion, said Sophos is an "attractive opportunity" to increase its exposure to the cybersecurity market.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: call up 14.2 points at 7,261.28
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Hang Seng: up 0.9% at 26,533.18
Nikkei 225: Tokyo market closed for holiday.
DJIA: closed up 319.92 points, 1.2%, at 26,816.59
S&P 500: closed up 1.1% at 2,970.27
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GBP: down at USD1.2567 (USD1.2698)
EUR: down at USD1.1018 (USD1.1030)
Gold: up at USD1,487.30 per ounce (USD1,476.20)
Oil (Brent): down at USD59.74 a barrel (USD60.30)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Monday's Key Economic Events still to come
Japan Health & Sports Day holiday. Financial markets closed.
US Columbus Day holiday. Financial markets remain open.
Canada Thanksgiving Day holiday. Financial markets closed.
1100 CEST EU industrial production
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UK Prime Minister Boris Johnson is coming under pressure to concede more ground to Brussels as hopes for an early breakthrough in the Brexit talks appeared to falter. UK and EU officials will resume talks in the Belgian capital on Monday with the prospects of an agreement in time for Britain to leave with a deal on October 31 in the balance. Time is rapidly running out if there is to be an agreement to put to EU leaders to sign off on at their two-day summit starting on Thursday. The EU's chief negotiator Michel Barnier said "technical-level" talks between officials over the weekend had proved "constructive". But in a briefing to ambassadors of the remaining EU27 on Sunday in Brussels, he said that "a lot of work remains to be done". Earlier Johnson told senior ministers that while a "pathway" to a deal could still be seen, there was "still a significant amount of work to get there".
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Heavy rain in the last week of September drove a fall in retail footfall in the UK with shopping centres being hit the hardest, the British Retail Consortium-Springboard Footfall & Vacancies Monitor showed. Footfall declined by 1.7% year-on-year in the five weeks to September 28, the same rate of decline BRC figures showed in the same period in 2018.
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Johnson is putting a crackdown on violent and foreign criminals at the centre of the first Queen's Speech of his premiership in a bid to "restore confidence" in the justice system. The package of 22 bills to be set out on Monday will include legislation to keep serious criminals in prison for longer, impose tougher sentences on foreign offenders who return to the UK and provide better protection for victims of domestic abuse. They will sit alongside measures intended to invest in the NHS, strengthen environmental protections and raise living standards through increasing the national living wage to GBP10.50 an hour. At the same time ministers are preparing to rush through a bill to ratify any Brexit deal Johnson is able to agree this week in Brussels in time for Britain to leave on the EU on October 31.
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The UK Labour party's renationalisation plans will cost at least GBP196 billion, according to the Confederation of British Industry. The business organisation said the price for the party's proposals for water and energy utilities, train companies and Royal Mail was equivalent to all income tax paid by UK citizens in a year. And the figure is close to the combined total of the GBP141 billion health budget, and the GBP61 billion spent on education, analysis by the CBI said.
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China's imports and exports fell more than expected in September, official data showed, as cooling demand at home and abroad hit trade in the world's second-largest economy. Globally, China's exports dropped 3.2% in September from the same period last year, while imports dived 8.5%, according to data from the customs administration. The EU has replaced the US as China's top trading partner amid a bruising tariffs spat, with imports from the US down 26.4% on-year in September. China promised to increase US agricultural purchases in a partial US-China deal announced Friday, which also includes protections for intellectual property and opening up financial markets. US President Donald Trump heralded the agreements as phase one of a "substantial deal". In exchange the US agreed to postpone a tariffs increase - from 25% to 30% - set to take effect on Tuesday on billions of dollars of imported Chinese goods.
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Tens of thousands of rescue workers were searching Monday for survivors of powerful Typhoon Hagibis, two days after the storm slammed into Japan, killing at least 35 people. Hagibis crashed into the country on Saturday night, but brought hours of heavy rains even before it arrived, causing landslides and filling rivers until they burst their banks. More than 110,000 rescuers, including 31,000 troops, worked through the night and into Monday, a national holiday, searching for people trapped by the disaster. Local media said at least 35 people had been killed, with the Kyodo news agency reporting nearly 20 people were missing. Government figures from Sunday night were lower, though updates were expected on Monday.
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Syria's Kurds have announced a groundbreaking deal with Damascus on a Syrian troop deployment near the border with Turkey, as Ankara presses a deadly cross-border offensive that has sparked an international outcry. The announcement on Sunday came as the US ordered the withdrawal of almost its entire ground force in Syria. Defense Secretary Mark Esper said the move to withdraw 1,000 US troops came after Washington learned that Turkey was pressing further into Syria than expected. Turkey's relentless assault, which has seen air strikes, shelling and a ground incursion manned mainly by Syrian proxy fighters, has killed scores of civilians and fighters since its launch on Wednesday.
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BROKER RATING CHANGES
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INVESTEC CUTS MEGGITT TO 'HOLD' ('BUY') - TARGET 640 (610) PENCE
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JPMORGAN CUTS OCADO TO 'UNDERWEIGHT' ('NEUTRAL') - TARGET 1050 (1073) PENCE
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CREDIT SUISSE CUTS SSE TO 'NEUTRAL' ('OUTPERFORM') - TARGET 1250 PENCE
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COMPANIES - FTSE 100
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HSBC Holdings will relaunch its telephone and internet-based retail banking brand First Direct in order to compete with new rivals and attract younger customers, the Financial Times reported. First Direct Chief Executive Joe Gordon told the FT that the retail bank would make new changes over the next 12 months to improve its services and introduce new features. New products to be added includes an in-app marketplace and a financial autopilot - a feature that will use artificial intelligence to make recommendations and automate activities, including topping up savings accounts. First Direct will allow customers with limited credit history to open accounts.
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COMPANIES - FTSE 250
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Emerging markets-focused asset manager Ashmore Group reported a 0.1% rise in assets under management for the quarter ended September, to USD91.8 billion. There was a 0.4% fall in blended debt, its biggest investment theme, while external debt grew 2.6% and local currency remained flat. Ashmore's corporate debt assets under management declined by 3.2%. The slight rise in overall assets under management reflected net inflows of USD2.4 billion, offset by a negative investment performance of USD2.3 billion.
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Iron ore pellet firm Ferrexpo said it is aware of media reports surrounding Chief Executive Kostyantin Zhevago, but said no legal action has been taken against him and he "strongly denies" any wrongdoing. Last week, Bloomberg reported Ukraine has added Zhevago to an international wanted list after he failed to report for questioning about former business commitments. He has been named as a suspect in absentia, Bloomberg continued, and investigators have begun court proceedings to find him. Bloomberg said Ukrainian investigators believe he has committed "large-scale" money laundering and embezzlement.
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Energean Oil & Gas has sold assets in the UK and Norway to Neptune Energy for USD250 million in cash. The assets were only recently purchased as part of Energean's takeover of Edison Exploration & Production, but they have been swiftly moved on with Energean looking to focus on the Mediterranean.
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COMPANIES - OTHER MAIN MARKET AND AIM
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Fashion firm Superdry has extended Interim Chief Executive Julian Dunkerton's contract to April 2021, as he looks to return the company to "sustainable growth". Company founder Dunkerton returned in April this year, having left in 2018, after Superdry issued a series of profit warnings.
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COMPANIES - INTERNATIONAL
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Visa and Mastercard announced their departure from Facebook's Libra project in a potentially fatal blow to the social network company's plan for a worldwide digital currency. Along with the two payment giants, several other large companies have said they are exiting Libra. Payment processing company Stripe said it is stepping back, as well as online auction company eBay. PayPal was the first of Libra's big partners to leave, announcing last week it would no longer be involved. Facebook faced substantial criticism over its plans to create a separate, private currency system to allow cross-border payments.
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3M has purchased medical technology firm Acelity for an enterprise value of USD6.7 billion, 3M said on Friday. Acelity focuses on medical technology such as advanced wound care and specialty surgical products under its KCI brand, 3M said. It has been bought off a consortium managed by Apax Partners, as well as the Canada Pension Plan Investment Board and the Public Sector Pension Investment Board.
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France's Total said it will be spending USD600 million as part of a partnership with Adani Group in India. Total will buy 25% of Adani's shares as part of the move, taking its total holding to 37%. The 50/50 partnership includes several gas assets in India, with the two main ones being the Dhamra terminal in the east of the country and "potentially" Mundra in the west.
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Boeing has split the roles of chief executive and chair, it said, to help the company focusing on bringing back its 737 MAX into service. The aerospace firm said Dennis Muilenberg will continue as chief executive, with Independent Lead Director David Calhoun stepping up as non-executive chair. This will give Muilenberg the time to fully focus on leading the firm, Boeing said.
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Monday's Shareholder Meetings
Carpetright (re credit facility)
BB Heathcare Trust
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By Tom Waite; thomaslwaite@alliancenews.com
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