Alterian’s take on SDL Group’s interest in the company is emphatic - that the possible cash offer of 80 pence per share undervalues the company so the board has unequivocally rejected it (see SDL circling troubled Alterian).
Yes, Alterian could be holding out for a higher offer but we think the refreshed board is more intent on putting itself to rights. It is currently undergoing a business review and putting together a transformation plan, which it says will be completed by December 13. It plans to reveal the outcome and progress to date when its interim results are released during the week of November 21. As it has said several times before, a sale is not one of the options it is exploring.
A sale may be forced on it if shareholders find the lure of ‘cash now’ more appealing than the uncertainty of a business transformation plan followed by an execution programme that could easily take a year or more to deliver significant results. As for SDL, by being the first mover in terms of going public with its potential proposal, it may be testing the market to see how well its 80 pence proto-offer is received with a view to adjusting to shareholders taste.
This is the second hostile acquisition attempt between two UK HQ’d companies – Enigmatic Investment’s pursuit of Clarity Commerce (start here and work backwards for the details) being the other. A positive reading of the situation is that if such potential acquisitions went ahead they would at least keep the companies as UK entities and hopefully improve their potential to compete on a global basis.