MYOB shareholders urged to reject Manhattan bid

Stephen Withers
Thursday, 04 December 2008 10:54

IT Industry - Listed Tech

The board of financial software and services company MYOB is maintaining its opposition to the bid made by US-Australian takeover vehicle Manhattan Software. "The offer is neither fair nor reasonable," said MYOB's chairman.

At the end of October, Manhattan Software Bidco Pty Ltd (associated with investment firms Archer Capital and HarbourVest) offered $1.0215 in cash for each MYOB share, rising to $1.1215 in return for full ownership.

The bid valued the company at up to $487 million.

Although the board described the offer as "opportunistic", Manhattan claimed initial support from the owners of 48 percent of the company's shares - predominantly institutional investors including Guinness Peat and Colonial First State.

The MYOB board's latest statement reiterates the conclusion of independent expert Lonergan Edwards that the Manhattan offer is neither fair nor reasonable.

"It comes as no surprise that Manhattan, which is keen to acquire MYOB as cheaply as possible, would argue against the conclusion of the independent expert that the offer is neither fair nor reasonable," said MYOB chairman Simon McKeon.

"The key point is that the Board regards the Independent Expert's report as comprehensive and thoroughly professional," he added.

The MYOB board disputes Manhattan's assertions about how unearned revenues and pro-forma earnings should be treated, argues that Reckon (Quicken's Australian licensee) is not a comparable company, and that the control premium offered by Manhattan is inadequate.

Is an alternative deal on the cards? Please read on.