Montagu to take Servelec private for £223.9m

The GP has made an all-equity cash offer of 313 pence per share, valuing the company at £223.9m. Based on the company's latest reports, this is an entry multiple of 15.6x its €14.32m projected 2017 EBITDA.

The offer represents a premium of 19.8% on the company's closing price on 22 November and 27.1% on the volume weighted average price per share for the three months ending on 22 November.

The transaction will be financed with equity from Montagu V, a €2.75bn buyout vehicle that closed in August 2016.

Montagu's acquisition vehicle, Scarlet Bidco, had received irrevocable commitments to the offer from the holders of 27,478,912 shares by Thursday afternoon. It must secure commitments from 75% of shareholders at the company's general meeting (date to be announced within 28 days).

3i Group acquired Servelec in a carve-out from De La Rue in October 1995 for an equity investment of £5.65m and an enterprise value of almost £9m. 3i sold Servelec to CSE Global for £18.6m in May 2000.

CSE Global held the company for the next 13 years, before floating it on the London Stock Exchange in December 2013 at a valuation of £122m. At the time of the IPO, Servelec reported a pre-tax profit of £10.9m from £39.4m in revenues.

Servelec said that backers that invested at IPO will have achieved a total return of approximately 185% on that investment, including dividends.

Servelec is a Sheffield-based enterprise software and hardware provider. The company's client base is diversified across sectors including healthcare, social care, education, oil and gas, energy and utilities. It was founded in 1977 and employs 600 people.  It generated £7.16m in profit from £31.5m in revenues for H1 2017.

Raymond James served as financial adviser to the bidder while Investec served as financial adviser and corporate broker.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Send to  

• Topics
• Buyouts
• UK / Ireland
• Technology
• Take Private
• Montagu Private Equity
• United Kingdom