Mobile value added services (VAS) company IMImobile is set to acquire UK-based mobile applications company WIN Plc at a valuation of $24 million (£15.93 million or Rs 110 crore). The deal has been recommended by the board of AIM-listed WIN and IMImobile Europe.
IMImobile has already received irrevocable undertakings or letters of intent from Win’s directors and shareholders in respect of 28.56% of the company’s shares. IMI Mobile already owns 2.37%, and now needs to reach 50%. The selling shareholders include Axa Investment Managers (18.56%), Henderson Global Investors (5.7%) and Hargreave Hale Ltd (1.96%). IMImobile Europe would also look at delisting WIN plc if it owns more than 75% stake in the company post the offer.
Incidentally, ISIS Equity Partners, WIN’s largest shareholder with a 19.01% stake, has earlier said that it opposes the deal and IMI’s offer 141 pence per share “would substantially undervalue the company.”
The offer by IMI is a 19% premium to WIN’s closing price on June 24 and a 44% premium to its average trading price over the last six months. The deal would be funded by IMI’s cash reserves, bank facilities and a loan to be made to IMImobile Europe by Spark Ventures plc.
Win Plc clocked 9.8% increase in turnover to £41.9 million (about $63.8 million) in 2009 with operating profit of £1.4 million (about $2.1 million). The company that generates almost 80% of revenues from the UK, had net earnings of £1.2 million (about $1.8 million). The zero debt company had cash of £3.1 million (about $4.7 million) at December end 2009.
Founded by Vishwanath Alluri (Chairman & CEO) and Shyam Bhat (CTO) in 2000, IMImobile has around 500 employees globally. The company raised $13-million funding from Sequoia Capital and its existing investor First Mark Capital in November 2009.
The WIN plc deal will be IMImobile’s fourth acquisition. In July 2009, it acquired Mobytec, a social aggregation and phone book management service provider in UK. Earlier in February 2009, it acquired Music2You, a music download and subscription services platform from Nokia Siemens Networks, and in November 2008, it acquired Dx3, a digital content delivery services provider in UK.