UPDATE 1-SS&C agrees 572 mln stg takeover of GlobeOp

Wed Mar 14, 2012 4:43pm GMT

Quotes

   

* 485-pence-a-share deal trumps TPG offer

* GlobeOp shares up 1.2 pct at 494p, above offer price

* SS&C to offer roles to GlobeOp mgt wanting to stay on (Adds detail, background, CEO quote)

By Laurence Fletcher

LONDON, March 14 (Reuters) - U.S. financial software provider SS&C Technologies agreed to buy hedge fund administrator GlobeOp, trumping an offer from buyout group TPG and raising expectations of a bidding war.

The 485-pence-a-share cash deal, well above TPG's 435p cash offer agreed last month, values GlobeOp at 572 million pounds ($900 million) and has been recommended by GlobeOp's independent directors.

GlobeOp shares were 1.2 percent higher at 494p by 1556 GMT, suggesting shareholders expect TPG to return with a higher bid.

The deal comes as investors pour money into the $2 trillion hedge fund industry, buoyed by an upturn in markets and hedge fund performance this year, raising demand for the services offered by administrators and other service providers.

Net inflows into hedge funds last year totaled more than $70 billion, according to Hedge Fund Research.

"We really like this business. We believe it's a good fit for us and makes us a top-three administrator in the world," Bill Stone, CEO of Connecticut-based SS&C, told Reuters.

Under TPG's deal, GlobeOp CEO Hans Hufschmid and his senior management team were set to continue running the firm. Stone said that under SS&C's deal, GlobeOp management wanting to stay on would be offered roles.

"We admire them (the GlobeOp management team). (For) any of the senior people who'd like to stay, we'd be able to find something meaningful for them to do," he said.

SS&C said in a statement it expects cost savings of at least $25 million within three years.

GlobeOp, which administers $173 billion in client assets, kicked off a strategic review in January to try and boost its share price.

Last week SS&C, which is more than one third owned by U.S. private equity firm Carlyle Group, proposed a 485-pence-a-share offer. Last month it said it had begun due diligence on GlobeOp on Jan. 14 and urged shareholders to wait for its next move.

The move is good news for hedge fund Cheyne Capital, whose funds have been building a stake in GlobeOp and now own 4.1 percent. ($1 = 0.6355 British pounds)

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