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A $526.8 million takeover proposal for Nitro Software (ASX: NTO) from Canadian software multinational Alludo failed to pass shareholder approval thresholds at a scheme meeting last week, but the KKR-backed bidder remains undeterred as it pushes on with an off-market buy-out.
With the unanimous support of Nitro's board and 12.53 per cent of its own in the founder-led e-signature software company, Alludo has advised it will consider the offer unconditional anyway if its able to build a 50.1 per cent interest by 7pm this Friday, 10 February, provided no outstanding conditions are breached.
Shareholders in Nitro Software cast 67.93 per cent of votes in favour of the $2.15 per share deal on Friday, falling short of the three-quarters of votes required for it to go ahead.
The stance of Sydney-based substantial shareholder Potentia Capital, which has been in a bidding war with Alludo for Nitro since it made a $1.80 per share offer in October, played a pivotal role in the scheme's rejection. If its votes were excluded, 89.66 per cent of votes would have backed the Alludo deal.
Nitro's board has urged all shareholders to "promptly accept" the Alludo offer by the Friday evening deadline.
The offer was deemed fair and reasonable by independent expert Kroll Australia which valued the company at $2-2.20 per share, claiming it was in the best interests of shareholders to accept in the absence of a superior proposal.
In today's notice, Alludo stated its current offer was its "best and final" and would not be increased, even if a superior proposal were to emerge.
Founded in Melbourne in 2005 with a team of three, Nitro Software was established as a pdf application alternative to Adobe Acrobat, and now has more than 13,000 business customers to its name.
Led by its co-founder and CEO Sam Chandler from its San Francisco headquarters, Nitro's annual recurring revenue (ARR) passed the US$50 million ($72 million) mark in June 2022, up 52 per cent year-on-year and bolstered by the US$81 million ($117 million) acquisition of e-sign rival Connective.
That ARR growth continued in the September quarter and the group is due to announce its annual results later this month.
Known for its graphic solutions delivered to remote workforces, Alludo went by the name of Corel Corporation before it was bought out by KKR in 2019, and owns the brands Parallels, CorelDRAW, MindManager and WinZip.
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