The board of geospatial-tech specialist Nearmap (ASX: NEA) has today provided its unanimous support for US-based software investment firm Thoma Bravo’s $1.055 billion offer to take over the entire company.
Under the deal, shareholders of the Sydney-based location intelligence company will receive $2.10 per share, entitling them to a 67 per cent premium on the six-month volume weighted average price (VWAP) of $1.26 to 12 August after the pair entered a scheme implementation deed.
Having considered several other non-binding expressions of interest, Nearmap chair Peter James said the board believes the all-cash offer from Thoma Bravo represents attractive value at a significant premium to the market price.
“The board has carefully considered the advantages and disadvantages of the proposed scheme and believes the offer price of $2.10 cash per share provides shareholders with certainty of value today for the potential of our business,” he said.
“Nearmap has achieved considerable success to date in Australia and North America, and while, in the long-term, there remains potential future growth trajectory, this has to be balanced with the business and market risks that Nearmap shareholders face remaining as a publicly listed independent company.
“In considering the merits of the Thoma Bravo proposal, the directors have at all times been guided by our overarching responsibility to consider the interests of Nearmap and all of its shareholders.”
Founded in 2007, Nearmap conducts aerial surveys capturing wide-scale urban areas in Australia, New Zealand and North America, providing location intelligence insights to a diverse range of businesses and government clients.
Its subscription base of 12,000 customers receives content delivered as orthogonal (2D) imagery, oblique cardinal direction imagery and 3D models from Nearmap’s own patented camera systems and processing software.
Offering an 83 per cent premium on Nearmap’s closing price of $1.15 on 5 July, the day before Thoma Bravo made the initial proposal, the deal encapsulates a 39 per cent profit on the business’ closing price of $1.51 on the final trading day (12 August) before the announcement was made.
“Nearmap has built a strong position in the location intelligence industry. Our business model is proven in Australia, and our ambition to continue to grow rapidly in North America aligns well with Thoma Bravo’s future ambitions for the business,” Nearmap CEO Rob Newman said.
“The proposal from Thoma Bravo is a strong demonstration of the success of our strategy and the capability of our people. We expect the location intelligence and aerial imaging market in North America to undergo change and consolidation over the next few years, which will present organic and inorganic opportunities for Nearmap.
“I look forward to our team’s continued outstanding work in support of our customers and eagerness to build on our success, benefiting from the operating capabilities, capital support and deep sector expertise from Thoma Bravo.”
The transaction, subject to FIRB approval, US competition/anti-trust clearance and customary conditions but not conditional on finance or due diligence, is due to be considered by the shareholders of Nearmap at a meeting held in November 2022.
Investing in growth-oriented, innovative companies in the software and technology sectors, Chicago-headquartered Thoma Bravo is one of the largest private equity firms in the world, with more than US$114 billion (AUD$165 billion) in assets under management.
Over the past 20 years, the firm has acquired or invested in more than 380 companies representing over US$190 billion (AUD$276 billion) in enterprise value.
The acquisition of Nearmap will be completed by Atlas AU BidCo, an indirect wholly owned subsidiary of funds advised by Thoma Bravo.
"We are incredibly impressed by Nearmap’s thought-leadership, and momentum in aerial imagery, data and analytics,” Thoma Bravo senior partner A.J. Rohde said.
“We believe Nearmap’s insights are increasingly mission-critical to enterprises, and the use cases rapidly evolving, as evidenced by the company's accelerating adoption with blue-chip customers in North America.
“We look forward to working closely with Rob Newman and the highly-innovative Nearmap team to continue scaling Nearmap in its next chapter as a private company."
The scheme includes the customary exclusivity provisions, including ‘no shop’, ‘no talk’ and ‘no due diligence’ restrictions, and a break fee (and reverse break fee) of approximately $10.5 million.
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