Fundtech Ltd. (Nasdaq: FNDT; TASE: FNDT) intends to drop its plan to merge with S1 Corporation (Nasdaq: SONE), after receiving a purchase offer from Chicago-based private equity fund GTCR Fund LP.
Fundtech says that GTCR is offering $23.33 per share in cash for the company, a 32.9% premium on today's opening price, and that, consequently, it has notified S1 that its board of directors intends to terminate the merger agreement with S1, and reach a deal with GTCR. The offer gives Fundtech a valuation of $370 million.
Fundtech provides software solutions for the financial services industry.
As a condition of the offer, GTCR will reach a voting agreement with Fundtech's parent company, IDB Holding Corp. Ltd. (TASE:IDBH) holding company Clal Industries and Investments Ltd. (TASE: CII), which owns 58% of the company. GTCR's offer is irrevocable until 12:00 noon (New York City time) on September 23.
Clal Industries CEO and Fundtech chairman Avi Fischer said, "Clal Industries & Investments invested in Fundtech 13 years ago. In the past few years, Clal Industries & Investments gradually increased its investment and involvement in the company.In light of the recent developments in the global markets, the offer that was received is an impressive honor towards Fundtech's management, led by Mr. Reuven Ben Menachem, Fundtech's employees, as well as for the Israeli high tech industry"
Last month, S1 rejected a higher offer from ACI Worldwide Inc (Nasdaq: ASIW), in favor the previous merger agreement with Fundtech. GTCR has agreed to pay a $11.9 million termination fee that may become payable to S1 in certain circumstances.
Fundtech's share price rose 0.7% on Nasdaq yesterday to $17.56, giving a market cap of $275 million, and jumped 26% to NIS 83, after trading in the share resumed on the TASE this morning.
Published by Globes [online], Israel business news - www.globes-online.com - on September 15, 2011
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