iSoft says yes to IBA takeover bid
Published: 05 Oct 2007 08:23 BST
After almost a year of uncertainty for IBA Health, iSoft's shareholders have "overwhelmingly" approved the Australian e-health group's £166m takeover offer.
The deal offers iSoft shareholders 69p cash for each share, representing a 23 percent premium on iSoft's closing mid-market share price on 16 October, according to IBA.
Investment company Allco Equity Partners (AEP) also announced it will support IBA with AU$300m (£131m) for a combination of shares and convertible notes which are to be issued by IBA.
To help refinance some of iSoft's debt and for working capital expenses, AEP will commit a further AU$62m (£27m). However, the final amount is contingent on whether iSoft shareholders decide to take cash or IBA shares.
Besides facing rising interest payments on its £93m debt, it was reported that iSoft had been struggling to fulfil its contract to supply the Lorenzo system as part of the NHS's National Programme for IT (NPfIT). Accenture pulled out of the entire project last year after a leaked email claimed that iSoft had "no believable plan" for the delivery of Lorenzo.
"We can now move forward with our integration plans for the group creating one of the world's largest providers of health information technology solutions with operations throughout the regions from Europe through to Australasia," Gary Cohen, executive chairman of IBA Health, said in a statement.
IBA's initial offer to iSoft was destabilised in July by German company CompuGroup, which announced in August it had already acquired 23.4 percent of iSoft from its existing shareholders — some 56.6 million shares. The takeover will make IBA the world's fourth largest e-health group.
Implementation of IBA's revised offer still remains subject to the High Court of Justice for England and Wales, which must sanction IBA's proposed scheme, expected to take place on 25 October.
"IBA will release further information to the market after completion of the formal merger process which is expected to complete on 30 October," said IBA's Cohen.
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