![[South Africa] Canadian software group Volaris makes a cash offer to acquire Adapt IT](Images/Key Logos/Adapt IT.jpg)
[South Africa] Canadian software group Volaris makes a cash offer to acquire Adapt IT
Johannesburg Stock Exchange-listed technology company, Adapt IT Holdings Limited has received a notice of firm intention to make an offer to acquire more than 50% of the issued ordinary shares of Adapt IT for a cash consideration of 650 cents per share.
The cash consideration represents a premium of 56.9% to the 30-day volume weighted average traded price of Adapt IT shares on the JSE of 414 cents, as at 26 January 2021, being the last trading date prior to the date on which the general offer by Huge Group Limited to Adapt IT shareholders was announced. The offer will be made by Volaris Group Inc or its wholly-owned subsidiary, a Canadian software company. Volaris is a subsidiary of Toronto listed Constellation Software Inc.
The offer will be made by way of a scheme of arrangement to be proposed by Adapt IT to their shareholders. If the scheme is not proposed or fails, Volaris will make a general offer to the Adapt IT shareholders to acquire at least 50% of Adapt IT shares.
If the scheme is implemented, Adapt IT shareholders will be entitled to elect to retain all or part of their Adapt IT shares and remain invested in Adapt IT as a delisted company. Irrevocable undertakings have been given to Volaris to vote in favour of the scheme and the delisting resolution by shareholders holding 21.6% of Adapt IT shares excluding treasury shares.
Volaris has provided a bank guarantee for the maximum possible purchase consideration to the Takeover Regulation Panel. The Volaris offer is an alternative to, and materially in excess of, the unsolicited all-share offer that Adapt IT received on 27 January 2021 from Huge Group to acquire up to all of the issued shares of Adapt IT.
Huge Group made an offer to Adapt IT shareholders in the ratio of 0.9 Huge Group shares for every Adapt IT ordinary share.
That swap ratio is based on a reference price of 613 cents per Huge Group share and implied an offer price of 552 cents per Adapt IT share, but the subsequent reduction in the trading price of Huge Group shares would imply an even lower offer price per Adapt IT share. In the event that the Volaris offer becomes operative, the listing of the Adapt IT shares on the JSE will, subject to compliance with the listings requirements of the JSE, be terminated if the delisting is approved by Adapt IT shareholders.
The Volaris offer is subject to all the applicable regulatory approvals, including the conditions set out in the SENS announcement outlining the details of the offer. The Volaris offer is also subject to Volaris acquiring more than 50% of the Adapt IT shares.
