Adapt IT has formed an independent board committee to assess Huge Group’s unsolicited bid to buy the software company in an all-share deal valuing it at R795-million.
Huge Group made the unexpected “general offer” to Adapt IT shareholders last week. Adapt IT has now, as required under South African takeover rules, constituted the independent board of directors, which is made up of Craig Chambers, Oliver Fortuin, Zizipho Nyanga and Catherine Koffman — the full complement of the company’s non-executive directorship.
This board will advise shareholders on the Huge Group offer as required under the takeover regulations. It will also appoint an independent expert to issue a report on the offer and to express an opinion on whether the terms and conditions are fair and reasonable to Adapt IT shareholders.
News of the creation of the independent board comes two days after Huge Group said it had secured the backing of more than three-quarters of its shareholders for its pursuit of Adapt IT. Both companies are listed on the JSE.
Huge Group counts large institutional investors such as Stanlib Asset Management, Sentio Capital Management and Praesidium Capital Management among its shareholders. It said shareholders representing 79.57% of Huge shares provided irrevocable undertakings to support the Adapt IT offer.
“The Huge board expects that further information will be contained in the ‘firm-intention announcement’, which should be released as soon as reasonably possible after the date of this announcement,” Huge Group said on Monday.
Though it it wants to buy 100% of Adapt IT, Huge Group has said it is also prepared to accept a lesser stake – and even a minority stake.
"Based on a reference price of a Huge Group share of R6.12, Huge Group is prepared to acquire one Adapt IT share for a purchase consideration of R5.52 to be settled by the delivery of 0.9 Huge Group shares, which is commonly referred to as the swap ratio," Huge Group said when announcing the offer last month.
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