Altium shares surge on unwanted $5 billion acquisition proposal

Altium shares surge on unwanted $5 billion acquisition proposal

Shares in printed circuit board (PCB) design company Altium (ASX: ALU) have risen by 34 per cent this morning after software design giant Autodesk Inc (NASDAQ: ADSK) launched a $5 billion takeover bid for the dual-listed company founded by Nick Martin.

Until this morning Altium was one of very few leading Australian tech stocks with the unwanted distinction of trading at levels close to the COVID-triggered market crash of March 2020.

Today's bid therefore marks a massive change in fortune for its shareholders, including CEO Aram Mirkazemi, whose family holds a roughly 7.5 per cent share in the Sydney-based group

Autodesk is offering to buy 100 per cent of Altium shares at $38.50 each, representing a valuation of more than $5 billion, but the board is not interested.

"The Altium Board appreciates the interest expressed by Autodesk, which has evolved from a dialogue about a strategic partnership," the company said in an ASX update.

"However, it considers that the proposal significantly undervalues Altium's prospects and therefore rejects the proposal at the current price.

"Altium has a unique position in the electronics ecosystem and in the past unsolicited acquisition interest has developed from partnership dialogues with others in the ecosystem."

The board highlights a strong track record of setting ambitious long-term goals and achieving them, which gives it confidence for achieving its goals of reaching 100,000 subscribers and US$500 million (AUD$646 million) in annual revenue by FY25.

"Having successfully pivoted to the cloud, Altium is now well positioned to pursue market dominance and industry transformation," the company said.

"The adoption of Altium's cloud platform is transforming Altium's business model from maintenance-based subscription to capability-based SaaS (Software-as-a-Service) subscription.

"As consistent with past unsolicited acquisition interest, the Altium board will engage with interested parties in the context of an appropriate valuation of Altium and it will continue to review all potential strategic alternatives for the company."

ALU shares had reached $36.46 each by 11:49am AEST, having crossed the $38 per share mark in the wake of the announcement just before 11am. 

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