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Bain makes second offer for SoftwareOne

Cloud and software specialist will have to consider a higher bid for the business after turning down last month’s opening offer

Bain Capital has issued a second bid for SoftwareOne, which follows a failed initial offer for the software and cloud player last month.

The first indications that Bain was after SoftwareOne emerged last month when the firm made an unsolicited offer for 100% of the business.

After the board looked at that first offer, valuing the business at £2.5bn, or around 18 Swiss Francs a share, the decision was taken to turn it down because “the proposal materially undervalues the company and is not sufficiently substantiated”.

Turning down that first offer, the board also pointed out that the business was focused on delivering its strategy and had its own growth plans.

“Earlier this year, the board unanimously voted to appoint Brian Duffy as CEO, and shareholders elected Adam Warby as chairman, to transition the company into a new phase of growth and operational excellence and drive future value creation. The board is confident in the progress made to date, and is convinced this further underpins the board’s view that the offer significantly undervalues the current and future valuation of the company,” the firm stated.

Bain’s first offer was backed by some of the shareholders at SoftwareOne, with Daniel von Stockar, B. Curti Holding and René Gilli, who together hold approximately 29% of the company’s share capital, showing support for the proposal.

Undeterred, Bain has now come back with a fresh offer, putting the value of SoftwareOne around £2.8bn, at 20 Swiss Francs a share, and the board will have to sit down again to consider their options.

“In line with its fiduciary duty, the board is assessing the revised proposal and will make a recommendation that it believes is in the best interest of all shareholders. A further announcement will be made if and when appropriate,” SoftwareOne stated.

The takeover talk comes on the back of decent first-quarter numbers issued by SoftwareOne in May, with the firm delivering an 8.7% improvement in revenues

At that point, the CEO had only been in post for a few weeks, but stated that he was keen to make an impact at the business. “I look forward to spending the next few weeks getting to know the global SoftwareOne team,” said Duffy. “Together, we will extend our ability to help our clients reap the full technological and economic benefits of moving to the cloud, while driving profitable growth and value creation for SoftwareOne’s shareholders.”

The first quarter also saw the firm acquire Beniva Consulting, an Elite-level ServiceNow partner, to boost its activity in the US market.

The firm indicated that it was standing by its outlook for fiscal 2023 on the back of a continued healthy demand environment.

Bain has made no comment on the second bid.

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