Having failed to find a better offer, SciQuest is urging its shareholders to approve a deal with one of its current investors to take the company private in a deal worth more than $500 million.
In an SEC filing, SciQuest (Nasdaq: SQI) says there are multiple reasons it believes shareholders should vote for the deal after it tried and fialed to find someone who would pay more for its shares.
SciQuest, a provider of eprocurement services, also notes that it was approached by private equity firm Accel-KKR (AKKR) about going private.
The deal is expected to close this month.
“We believe stockholders will recognize the logic and value of this transaction,” the company said.
The company noted that:
| “AKKR has been a significant shareholder in SciQuest with 4.9% ownership. |
| “ | AKKR approached SciQuest. |
| “Despite its solicitation efforts, SciQuest did not receive any alternative acquisition proposals for the board to consider during the go-shop period, which expired on June 24, 2016.” |
In the filing, SciQuest spelled out the following reasons for why it believes the buyout is a good deal.
| Why should stockholders support this transaction? |
| • | At $17.75 per share in cash, stockholders will receive compelling value for their shares — a 34% premium to the closing price on 5/27. |
| • | It is an all-cash offer. |
| • | There is no financing contingency. |
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The ~3.2x revenue multiple that the offer represents compares well to current trading multiples for SaaS companies who are expected to have revenue growth of ~10% or less in 2017 (<1.5x). |
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Read the filing at: https://www.sec.gov/Archives/edgar/data/1082526/000119312516636656/d196020ddefa14a.htm |
