It seems as though IFS will finally become a private company. Last year the board recommended that shareholders sell up to EGT through IGT Holding. However, the price offered of SEK 362.50 did not seem enough to all shareholders. When the offer expired in February 2016, IGT were left holding only 84% of the A and B Shares. This fell short of the 90% needed under the Swedish Companies act to complete an acquisition.
However, one of the major hold outs, Elliot International L.P., part of Elliot Management, a US hedge fund, has agreed to sell. Holding out was clearly worthwhile for Elliot International. They achieved a price of SEK396.73 per share for the remainder. This is significantly higher than the original offer price. A price they have only peaked briefly at twice over the last six months. Proceedings to delist IFS from the Nordic Stock Exchange will commence soon.
EQT Avoiding the courts over IFS
No doubt EQT partners will be breathing a sigh of relief over this deal. At 84%, despite the boards recommendation they would have had to go through a costly board process to acquire the remaining shares. With this latest tranche in their hands they will own 97% of IFS and can move the company smoothly into private ownership. With more than six months elapsing between the expiry of the original bid and this deal, none of the original shareholders will gain additional monies. Had EQT not waited the six months they would have had to compensate all the other shareholders the difference. The timing of this announcement is more down to six month elapsing rather than when the agreement was made. In fact it may have been made as far back as April 1st when the IFS Share spiked.
There are now no significant barriers to EQT acquiring IFS. IFS have stated that they will make further announcements in the coming weeks.
Conclusion
IFS are not the first company to change hands. Infor are already in private equity hands and Epicor recently changed ownership moving between two private equity firms. As yet there has been no announcement from the leadership about the acquisition merely a short press release. It will be interesting to see what the leadership has to say at the IFSWorld conference. It will take place in Gothenburg between 25-28 October later this year.
