GCIEquals extends acquisition deadline to Oct 2 as JC Flowers joins interested parties
What I love about investing is that it teaches you patience - and tons of it.
Take () , a leading fintech forex/payments platform.
The business is undoubtedly performing well. Indeed in H1'24, revenues jumped 33% to £59.96m (£45.0m LY) and cash closed Jun'24 at £20.5m (or 10p/diluted share), augmented by an exit Q2'24 sales run-rate of £32.6m (+40% YoY).
Yet the shares at 118p are surprisingly flat YTD. Why?
Well to me, this underperformance (+7% FTSE All Share) is simply due to the uncertainty created by the ongoing Strategic Review process, which started in Nov'23.
Moreover, today the 'Put Up or Shut Up' period was extended by a further 4 weeks to 5pm 2nd Oct. Here American private equity house JC Flowers (owner of 'Castle Trust Bank') has now also joined the bidding consortium alongside TowerBrook Capital and Railsr, in order to progress a "fully equity financed" offer, with negotiations, financing and due diligence all "at an advanced stage".
No take-out price was detailed. Albeit on 10th July, an indicative, non-binding proposal of 135p/share (£276m fully diluted) in cash was mentioned.
So unless something crops up late in the day, I'd expect a firm offer to be submitted to the Board shortly after Equals Money releases its H1'24 results sometime next week. The strategic logic (re cost/sales synergies) of combining the company's best-in-class forex/banking platform with both Railsr and Castle Trust Bank seems to make perfect sense.
Watch this space.
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