A cash acquisition of software firm Ideagen is set to be recommended by directors to shareholders.
The deal would value the Nottinghamshire-based firm at £1.05bn.
Rainforest Bidco Limited (Bidco), a company indirectly controlled by funds managed by Hg Pooled Management Limited (Hg), is behind the acquisition.
The boards of Bidco and Ideagen have reached agreement on the terms of the cash acquisition in which Bidco would acquire the entire issued and to be issued ordinary share capital of Ideagen.
The acquisition is conditional on, amongst other things, the approval of Ideagen shareholders.
Bidco is a newly formed company owned and controlled by funds managed by Hg, a software and services investor.
Richard Longdon, non-executive chairman of Ideagen, said: “We believe that the offer from Bidco represents value for shareholders and the Ideagen directors unanimously intend to recommend the offer to shareholders.
“The all-cash offer represents a compelling and attractive opportunity for shareholders to realise and crystallise their investment in Ideagen in the near term and also provides a significant premium to the prevailing share price notwithstanding the backdrop of the wider risks posed by the political and macro-economic environment.
“The offer reflects the quality, strength and long-term performance of Ideagen’s businesses and its future growth potential. We believe that Hg’s track-record and expertise in supporting and growing software businesses would provide a complementary partner for Ideagen’s stakeholders.”
Christopher Fielding, Joris Van Gool and Jean-Baptiste Brian, partners at Hg, said: “At Hg, we have spent over 20 years focused on the business-to-business software space. We have long admired how Ben and his highly motivated team have grown Ideagen into a leader in its sector.
“Our experience in the sector gives us strong conviction that Ideagen represents a high-quality platform, and we are committed to providing additional capital and resources that are required to further support and enhance Ideagen’s next phase of growth.
“Hg has a strong track record of investing in and growing UK-based software businesses. We recognise that Ideagen is a global organisation with stakeholders around the world, but with deep community ties and a strong local heritage. We strongly believe that the core of the business should be maintained in its Nottingham base, including its executive team and technological development centre.”