The Wameja Ltd (ASX: WJA) share price has smashed through its 52 week high as it rockets on news of a scheme agreement with Burst Acquisition Co, owned by Mastercard Inc (NYSE: MA). At the time of writing, the Wameja share price is sitting at 14 cents, having risen 52.17%.
What does Wameja do?
Wameja is a software company that enables crossborder transfer between bank accounts, cards, mobile wallets, or cash outlets from anywhere in the world. The company is already partnered with Mastercard in regards to its HomeSend global payment hub.
Wameja is dual listed on the the London Stock Exchange, having listed here in Australia in early 2000.
Takeover details
This morning, Wameja advised that it has entered into a scheme implementation agreement (SIA) with Burst Acquisition. The details of the SIA are that Mastercard will acquire all of the issued capital of Wameja for 14.3 cents per share. The news has sent the Wameja share price shooting close to the offer price.
It should be noted that the scheme is subject to a number of conditions which must first be satisfied before the scheme can be implemented. Wameja’s shareholders and depository interest holders do not need to take any action at this time.
What’s next?
There is significant support for the agreement with institutional shareholders on board. Lombard Odier Asset Management, which represents around 23.5% of the issued capital, has provided a letter of intent advising of its intention to vote in favour of the scheme. Moreover, Australia’s First Sentier Investors has also notified of its intent to support the agreement.
On top of the strong institutional shareholder support, the Wameja board is also unanimously recommending the scheme. The board is suggesting that, in the absence of a superior proposal, shareholders vote in favour of the scheme.
The Wameja share price has rallied strongly on today’s announcement. This is positive news for shareholders who can add to their already impressive gains this year. Prior to the announcement, the Wameja share price was up 15% for the year. After today’s gains, however, Wameja shares have now increased 75% year to date.
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Daniel Ewing has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Mastercard. The Motley Fool Australia has recommended Mastercard. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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