Swiss software company One rejects takeover offer from Bain

Last Updated: 17. Januar 2024By

Software One rejects takeover offer from Bain: Stock price under pressure The decision to remain independent is immediately reflected in the stock price of Software One. Investors reacted negatively on Monday and pressed the sell button. At one point, the shares dropped by 12.1% to 14.23 Swiss francs.

Although there was a slight recovery on the trading day yesterday, with a closing price of 15.08 Swiss francs, the shares are still well below the issue price of 19 francs, at which the stock made its debut on the stock exchange in 2019.

Software One – Software Manager cuts its forecast With over 9,000 employees, Software One is one of the major software managers. The focus is on the distribution of software solutions from industry heavyweights such as Microsoft, Amazon Web Services, Adobe, Oracle and others. In addition, the company also offers its own products, such as the Software Lifecycle Management (SLM) service. This service helps companies manage their software licenses and prevents possible license violations or over-licensing.

However, things have not been going quite as smoothly operationally lately: The group recently lowered its revenue forecast for 2023. Instead of double-digit growth, the company now only expects high single-digit growth at constant exchange rates. In the third quarter of 2023, group revenue only increased by 8.4% to 233 million Swiss francs compared to the previous year.

The majority of the revenue, namely 121 million Swiss francs, was generated by the company’s Software & Cloud Marketplace business. This business area operates a cloud platform through which companies can find, buy and manage technology products.

First takeover offer already in June 2023 Last summer, the US private equity firm Bain, together with the founders, made a voluntary public takeover offer of 18.50 francs. In July, Software One rejected an improved offer in the range of 19.50 to 20.50 francs as insufficient. The price offered by Bain Capital most recently was only 18.80 francs, based on a thorough examination of the books (due diligence). In total, Bain would have paid nearly 3 billion Swiss francs.

Bain Capital offer rejected: Founders retain majority Despite the previous support of the non-binding takeover offer from Bain Capital by the founding shareholders of Software One, Daniel von Stockar, René Gilli, and B. Curti Holding AG, the board of directors rejected the offer. An independent evaluation and expert advice led to the unanimous opinion that the proposed valuation is not in the best interest of the company and its stakeholders.

Capital market day announced: Insights into the future of Software One In connection with the announcement of the rejection of the takeover offer, Software One reaffirmed its forecast for the 2023 financial year. The company is aiming for high single-digit revenue growth and an adjusted EBITDA margin (earnings before interest, taxes, and depreciation) of 24% to 25%.

Investors are likely to have their eyes on February 15th. Not only will the annual results for the full year 2023 be published, but as part of a capital market day, insights into the future of the company will also be provided. This is likely to be decisive for the development of the stock price.