KKR nudges up bid for Australia’s MYOB
SYDNEY — Australia’s MYOB Group said it will grant due diligence to KKR & Co after the US buyout giant sweetened its offer to take full control of the accounting software provider firm to A$1.8 billion (US$1.3 billion).
KKR, which owns 19.9 per cent of MYOB, lifted its bid for the rest of the shares by 2 per cent to A$3.77 per share, valuing the company at A$2.2 billion.
If successful, the deal would be one of KKR’s biggest acquisitions in Australia and add to its 10-strong stable of technology businesses in the Asia-Pacific region.
“My read of is they have raised the offer price to gain access to do due diligence, so that indicates a step forward,” said Jules Cooper, an analyst at stockbroker Ord Minnett.
“The price is certainly above our valuation today,” he said, adding that he thought MYOB was worth A$3.28 per share.
Melbourne-based MYOB, which at the time of KKR’s first bid last month only said it was assessing the offer, saw its shares surge 6 per cent to a two-week high of A$3.52 yesterday. That, however, remains 7 per cent below the bid price, suggesting investors are wary that a deal may not be sealed.
Although MYOB was once the dominant provider of accounting software to small and mediumsized businesses in Australia, it has in recent years struggled to compete for market share with cloudbased administrative software company Xero Ltd.
Xero, based in Wellington, New Zealand, has a market value of A$5.8 billion. It has overseas offices, including those in London, San Francisco and Denver, while MYOB operates only in Australia and New Zealand.
KKR said at the time of its first bid that it wanted a unanimous recommendation from MYOB’s board to close the deal. — REUTERS
Trading information for KKR Co is displayed on a screen on the floor of the New York Stock Exchange in New York, US. — Photo breakingnews.com