5th Oct 2015 06:40
LONDON (Alliance News) - Business processing outsourcing company Xchanging PLC on Monday confirmed it has received takeover offers from FTSE 100-listed rival Capita PLC and US buyout house Apollo Global Management.
Xchanging said it received a non-binding takeover offer valuing the company at 140 pence per share from Capita back in August, but it rejected this bid. Capita then came back with a bid valuing the company at 145 pence, which was also rejected, but Xchanging granted it access to its books in September when Capita made another 155 pence bid.
Capita then raised that offer further, to 160 pence per share, and Xchanging said it has now granted Capita due diligence access. Capita's bid values the company at GBP396.6 million.
Separately, Apollo has made a bid for Xchanging valuing the company at 170 pence per share and has also been granted due diligence access. Apollo's bid values the company at GBP421.3 million.
Capita, in a separate statement, said the 160 pence takeover offer was its final bid for the company and said it represents a 58% premium to Xchanging's closing price on September 24, the day the final proposal was made. Capita said it likely would fund the deal, if it progresses, with a share placing.
It said it must make a firm offer by November 2.
Capita said it thinks the Xchanging acquisition would be consistent with its strategy of acquiring business which build its capacity in existing operations. It would strengthen its position in the insurance and asset administration outsourcing sectors and would deliver around GBP35 million in annual cost synergies.
By Sam Unsted; [email protected]; @SamUAtAlliance
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