We added two new stocks to the watchlist as elevated levels of corporate activity has continued this morning, with technology names Altium Ltd (ALU) and Hansen Technologies (HSN) having fielded indicative and non-binding offers over the weekend.
Additionally, Japara Healthcare (JHC), which was already on the watchlist, announced it had received a higher offer which it deemed sufficient to allow due diligence to be conducted.
It comes as no surprise that private equity is the source of one of the approaches, with BGH Capital offering $6.50 per share to HSN in a bid to gain access to its books. The HSN board has considered the proposal sufficient to allow due diligence, and assuming there are no skeletons in the closet it is likely we will see a formal bid announced at the conclusion of due diligence. As the HSN board did not solicit the bid, there is every chance other suitors will cast an eye at the situation so we remain hopeful of buying the stock once binding documentation is signed.
ALU, on the other hand, has been less receptive as it has announced that it has rejected the proposed $38.50 offer from NASDAQ-listed Autodesk Inc. According to ALU, the offer has come because of discussions between the two about a strategic partnership but that it falls short of the ALU’s view of the value of the company. This deal has been outed by the AFR, so it is likely in the earlier stages and ALU’s announcement is vague regarding Autodesk’s response to ALU’s stance, so it’s too early to say whether further offers are likely.
Finally, JHC has been in discussions with Calvary Health Care for a while now and has negotiated an increase from an earlier offer of $1.08 to $1.20 per share and will now allow due diligence to be conducted. This is not the first takeover approach in the sector lately so the hope is that a binding deal could unearth other interest, and we remain hopeful that we will get an opportunity to buy the stock.
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