April 3, 2018 / 3:08 PM / in 7 months

Fidessa postpones vote on Temenos bid to await possible counter offers

(Reuters) - British software firm Fidessa FDSA.L postponed an imminent shareholder vote on whether to back a 1.4 billion pound ($2 billion) takeover bid from Switzerland’s Temenos (TEMN.S), saying it might receive two more offers.

Fidessa said in a statement that it had received approaches “from two separate third parties who are each considering making an offer for Fidessa at a premium to the Temenos offer.”

One of the potential new offers would be at a 5 percent premium to banking software supplier Temenos’s cash bid, it said. It did not disclose details of the other potential offer.

“Discussions with the third parties are ongoing and there can be no certainty that a formal offer from either will be forthcoming or as to the terms of any such offer,” Fidessa said.

Shares in Fidessa were up 11.9 percent at 41 pounds by 1430 GMT. Temenos shares fell 3.4 pct to 110.5 Swiss francs ($116).

Fidessa had been due to hold both a shareholder and a creditor meeting on Thursday but said it was in its shareholders’ interest to postpone the meetings “in order to explore in more detail the possible alternative offers.”

“The Temenos offer will not lapse as a result of this announcement or the adjournment of the meetings”, the company said.

However, it is a condition of the Temenos offer that the meetings are held on or before April 27.

ELLIOTT STAKE

Temenos has been looking to add Fidessa’s equities trading technology to expand its customer base in the financial services industry.

It made an offer of 36.467 pounds per share for Fidessa on Feb. 21.

Fidessa said one of the two potential new offers would give shareholders 38.297 pounds per share, representing a 5 percent premium to Temenos’ offer. That would value Fidessa at 1.48 billion pounds, according to a Reuters calculation.

Activist investor Elliott Capital Advisors, which has used its stakes in takeover targets to extract a higher price from buyers, disclosed a 4.9 percent stake in Fidessa on the day of the Temenos offer.

Elliott declined to comment on its intentions when asked to do so by Reuters in February.

As Temenos is proposing to buy Fidessa by way of a scheme of arrangement, Fidessa needs the backing of 75 percent of its shareholders for the deal to go through.

Temenos said earlier it would borrow up to 1.43 billion pounds to pay for the deal.

The enlarged company would have had revenues of more than $1.2 billion in 2017, and a core profit margin of 32.3 percent.

Reporting By Justin George Varghese in Bengaluru and John Revill in Zurich; Editing by Arun Koyyur and Susan Fenton

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