28th June 2013. ASX-listed IT financial services firm Bravura (ASX:BVA) has announced the receipt of an indicative, non-binding, conditional proposal from its majority shareholder, private equity firm Ironbridge Capital to acquire all outstanding shares and options in the Company.
Under the Scheme Proposal, Ironbridge has offered $0.28 cash per Bravura share less the amount of any dividend declared by Bravura prior to implementation of the Scheme Proposal. The scheme values Bravura’s equity at A$172.6m.
Bravura Solutions supplies superannuation, life insurance, investment, private wealth and portfolio administration, transfer agency and financial messaging software applications. While the company’s is listed on the Australian Securities Exchange, most of its revenue comes from the UK and Europe.
Ironbridge bought into Bravura in September 2009, acquiring 46% as part of a recapitalisation of the business which gave it shares at 15 cents, and has since crept to hold 67% per cent of the shares on issue. The recpitalisation followed an earlier bid from Ironbridge at $1.73 a share, which failed when the company missed forecasts, and its founders Iain Dunstan and Simon Woodfull were embroiled in margin loans with failed broker Lift Capital.
The offer price of $0.28 per share represents:
- a premium of 48% to the 3 month volume weighted average price to 27 June 2013 of $0.189;
- a premium of 51% to the 1 month volume weighted average price to 27 June 2013 of $0.185; and
- a premium of 65% to the closing price on 27 June 2013 of $0.170.
Following receipt of the initial proposal, the Company formed a committee of independent directors comprising Brian Mitchell and Trevor Perry to consider the Scheme Proposal and to progress discussions with Ironbridge and facilitate access to due diligence. The company advises that the independent directors intend to recommend the proposal, in the absence of a superior proposal, and subject to the negotiation of a mutually satisfactory scheme implementation agreement, and the independent expert providing an opinion that the Scheme Proposal is in the best interests of shareholders.
Bravura advised it had received an initial unsolicited, indicative, non-binding and conditional proposal from Ironbridge on 6 May 2013, and that it has received an updated proposal on the 27th June. The Scheme Proposal is subject to due diligence and various other matters including:
- Ironbridge obtaining approval from its debt financiers to fund the debt component of the financing for the Scheme Proposal;
- execution of a mutually satisfactory scheme implementation agreement;
- unanimous recommendation in favour of the Scheme Proposal by the independent directors;
- Fisher Funds Management Limited (Fisher Funds) confirming that, in the absence of a superior proposal, that it will sell its Bravura shares
- no material acquisitions or disposals or material commitments outside the ordinary course; and
- no material adverse change in Bravura’s value, business, operations or prospects prior to implementation of the scheme proposal.
Fisher Funds, who own 14.13% of Bravura, have that it will, in the absence of a superior proposal for 100 per cent of the Company, support the proposal from Ironbridge and vote its interests accordingly.
Macquarie Capital (Australia) Limited is acting as financial adviser and Clayton Utz is acting as legal adviser to Bravura.
Ironbridge is advised by Fort Street Advisers.
Ironbridge is a leading independent Australian private equity manager, managing funds in excess of A$1.5 billion on behalf of Australian and international institutional investors. Ironbridge is focused on investments in medium to large sized management buyout and expansion capital transactions in Australia and New Zealand. Ironbridge targets management buyout and expansion capital opportunities, typically in the $250 million to $750 million range. Ironbridge was formed in 2003 by former Gresham Private Equity partners Neil Broekhuizen, Paul Evans, Julian Knights and Greg Ruddock