EQT Fund Management’s second bid for Melbourne-headquartered Iress has been declined.
The initial confidential, unsolicited, non-binding and indicative proposal was received on 18 June 2021 and put the price at A$14.80 (£7.84, $10.94, €9.21) per share.
But it was not considered to be in the best interests of shareholders.
The follow up offer, which was received on 4 July, upped the price to between A$15.30 and A$15.50 per share. Again, the board determined that it was not sufficiently compelling.
Iress provides software and services for trading & market data, financial advice, investment management, mortgages, superannuation, life & pensions and data intelligence.
Thanks, but no thanks
In a statement on the Australian Stock Exchange (ASX), the board said: “Following careful consideration, including obtaining advice from its financial and legal advisers, [it has] unanimously concluded that the indicative proposal was conditional and did not represent compelling value for Iress shareholders.”
It has not shut the door on a potential deal, however.
The statement continued: “The board informed EQT that is was prepared to provide it with access to limited non-public information so EQT can develop a proposal that is capable of being recommended to shareholders.”
That information has since been shared, but the board stressed that “there is no certainty that discussions […] will result in a revised proposal”.
Iress was “one of the very first firms to start the trend” of adviser technology evolving into a global business, according to Ian McKenna, founder of AdviserSoftward.com and the Financial Technology Research Centre.
“The established management team has a strong track record of delivering scale solutions to financial advice firms in multiple jurisdictions. The growing collaboration between financial regulators is making it far easier to build and deploy solutions across many different countries with suitable localisation,” he added.
“Iress are strong players in wealth, mortgages and life insurance; so, have offerings that can support the full long-term savings and protection landscape.
“Even if the current bidder does not proceed, I expect many others will now be taking a good look at this firm, which certainly has a lot to offer,” McKenna added.
What is EQT?
EQT Fund Management is a subsidiary of Stockholm-headquartered EQT Group, which describes itself as a global investment organisation focused on active ownership strategies.
It has two core business strategies – private capital and real assets.
It operates through 24 countries across Europe, Asia-Pacific and the Americas – including an office in Sydney.