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Francisco favourite to clinch Kewill after Symphony withdraws

27 Jun 2012

US private equity firm Francisco Partners has emerged as the favourite to buy struggling software company Kewill after rival buyout house Symphony declined to table a counter offer, in a sale process that is expected to fetch over £100m.

Symphony yesterday declined to increase its 106p per share all cash offer for the business, an offer that was trounced last week by an 110p bid from Kinetic Bidco – Francisco Partners’ investment vehicle.

Kinetic Bidco’s offer values Kewill at £102.7m, and has been backed by management and a group of shareholders comprising Centaurus Capital, SVG Investment Managers, RGM Capital, and Pendragon Capital, who control 24.9 per cent of Kewill’s stock.

The shareholder group has agreed not to accept a rival offer unless it is priced at 118.25p or higher and tabled before the bidding deadline on Friday.

Francisco’s offer represents a 45 per cent premium to the software developer’s closing share price on 1 May, the day before Francisco’s initial offer.

Guildford, UK-based Kewill has issued a number of profit warnings over the past few years. The company reported pre-tax losses of £740,000 from revenues of £27.2m in the six months to the end of September.

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