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(Alliance News) - Tribal Group PLC has recommended a takeover approach with an implied enterprise value of GBP172.3 million, from Ellucian, a US software provider to the education sector.
The Bristol-based educational software and services provider said the cash deal was worth 74 pence per share and valued the business on a fully diluted basis at GBP159.5 million.
It represents a 41% premium to the closing price of 52.30 pence in London on Thursday.
If the deal does not become effective on or before December 31, Ellucian and Tribal have agreed that Tribal shall be entitled to pay a one-off dividend of up to 0.65 pence per Tribal share to shareholders.
Tribal said it considered the terms of the bid to be "fair and reasonable".
"Whilst the Tribal directors consider the standalone prospects for Tribal to be strong, there are clear and compelling benefits for the business presented by the acquisition and the Tribal directors have determined that the offer reflects a fair valuation for the business," the company said.
"Joining Ellucian will create an enhanced platform which will leverage the strengths of both businesses across the complementary geographies in which Tribal and Ellucian operate for the benefit of our customers, enabling the provision of a broader set of solutions," said Tribal Chair Richard Last.
Ellucian is a Reston, Virginia-based provider of software and services designed for higher education.
It works with more than 2,500 institutions in nearly 50 countries and over 18 million students.
"Tribal is in clear alignment with Ellucian's strategy, purpose and values, and this is an exciting opportunity to expand our combined reach as we power tertiary education so institutions can empower student success," said Ellucian Chief Executive Laura Ipsen.
"We recognize Tribal's notable transformation journey to cloud and are eager to work with Tribal's strong leadership and talented team. With this investment, we can accelerate our impact in large and important educational markets around the world."
By Jeremy Cutler, Alliance News reporter
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