Tech firm eyes up £27m takeover deal
A £27.68m takeover offer has been received by a Coventry-based technology company, as its new management team looks to turn the business around.
The offer for FireAngel, a developer and supplier of home safety products, comes from Intelligent Safety Electronics (ISE), incorporated in Singapore and owned by Siterwell Electronics, following a challenging period.
FireAngel admitted in September that it faced a “material uncertainty” after exiting a contract and said it may need to revisit its banking covenants, which were waived and then reset earlier this year. Chairman Andrew Blazye and chief executive Neil Radley joined in June after a £6m fundraising was completed to lead a recovery, with the aim of reducing its net debt to £2.8m.
Manufacturer of security protection ISE already holds 17.46% of FireAngel and now looks to purchase the remaining shares for 7.40p a share, which values the firm at £27.68m.
In a statement to the London Stock Exchange, ISE said: “The highly competitive market environment in which FireAngel operates and the heightened global macroeconomic challenges has generated headwinds for both FireAngel and its share price.
“The board of ISE believes that the Offer provides a certain path to recover lost value for FireAngel Shareholders and an immediate and compelling proposition for all stakeholders”.
The conditional offer is being unanimously recommended to shareholders by FireAngel directors, who are being advised by PwC on the offer’s financial terms.
Andrew Blazye, Chairman of FireAngel said: “As part of its strategic review of FireAngel, the Board has considered a number of options for the Group in order to ensure all potential avenues to build stakeholder value have been fully explored.
“The Board is very mindful of the continued trading challenges the Group faces in the medium term and believes this offer by ISE represents an opportunity for shareholders to realise a return, in cash, at a significant premium to FireAngel’s current prevailing share price.
“FireAngel has a longstanding relationship with ISE through Siterwell, initially as a valued manufacturing partner and more recently as a major shareholder, and the Board is confident that it can provide a supportive environment for FireAngel’s long term success.”
Wang Jiejun, a director of ISE said: “We think this is a great deal for FireAngel Shareholders and are delighted that the Board has recommended our offer. We believe it represents an excellent premium to the share price and encourage shareholders to accept the offer.”
