The board of Irish data analysis and automation software company Glantus has recommended that shareholders accept an offer to buy the business at a valuation of £17.8m.
The offer has come from Basware, a Finnish based invoice processing automation software firm.
It follows Basware and backer Accel-KKR making a takeover approach for Glantus last month which resulted in a jump in its share price.
The all cash offer values the issued share capital of Glantus at approximately £17.8 million on a fully diluted basis and implies an enterprise value of £29.5 million, the company said in a statement.
The company was set up in 2014 by Maurice Healy and floated on the Alternative Investment Market of the London Stock Exchange in 2021, raising £10m through an oversubscribed placement of shares at a market capitalisation of £37m.
The proceeds from the flotation were to be used by the company to support its growth strategy by investing in account management, sales and marketing.
But Mr Healy said the company has faced an extraordinary challenging period since then.
"2022 was particularly difficult and Glantus was forced to restructure the business and enter into negotiations with its lender due to low levels of cash resources," he said.
"While trading has improved in FY23 so far and Glantus is much better positioned following the restructure, the Company has significant levels of debt in a higher interest rate environment and low levels of cash resources and confidence with public market investors take a significant time to rebuild."
"These factors are all reflected in the Company's current market capitalisation."
He added that the board of the company is unanimously recommending the offer as it represents a compelling opportunity for shareholders to realise their investment in cash in the near term and is at a very significant premium to recent share prices.
"Despite recent challenges, the business has significant scope to further expand its footprint, which we believe will be best achieved in the private arena where Glantus can benefit from the experience and capital of Basware as its partner, whilst maintaining the management and wider team which have driven the business forward to date," he said.
Jason Kurtz, Chief Executive Officer of Basware, said the proposed deal is a compelling opportunity and one that is consistent with Basware's strategy of investing in AP automation applications that deliver value to our customers.
"We believe Glantus is an exceptional fit with our investment strategy in terms of size, focus and business model," he said.
"Partnering with a high-quality management team will allow us to build long term shareholder value whilst leveraging off the core domain expertise of Glantus to create truly differentiated products and deliver unique value to customers."
The scheme of arrangement which sets out the terms of the proposed deal is to be published within four weeks and it is hoped it will be passed by shareholders and effective by the fourth quarter.
