It was a quiet week for the Mainstream Group Holdings Ltd (ASX: MAI) share price. That was until it suddenly jumped 60% before close on Monday. At the time of writing, the Mainstream share price is up 0.76%. trading at $1.99.
Mainstream share price jumps on superior takeover
On March 9, Vistra offered to acquire 100% of Mainstream shares at $1.20 per share. A go-shop period was provisioned to allow Mainstream to seek out competing offers until 11 April.
On Monday, the company announced that a superior proposal has also emerged from SS&C Technologies Holdings, Inc. (NASDAQ: SSNC) for $2.00 cash per share, a 67% premium to the price per share offered by Vistra.
Mainstream has notified Vistra, and Vistra has until 16 April to match or offer more favourable terms.
Mainstream has entered into a Scheme Implementation Deed with SS&C, conditional upon the following:
- Vistra not exercising its matching right.
- Mainstream terminating its Scheme Implementation Deed with Vistra.
- Mainstream paying a $1.708 million break fee to Vistra.
Who’s acquiring Mainstream?
SS&C is the world’s largest hedge fund and private equity administrator. Its business model combines end-to-end expertise across financial services operations within software and solutions. In particular, to service the financial services and healthcare industries.
The company owns and operates the full technology stack across securities accounting, front-to-back office operations, performance and risk analytics, regulatory reporting, and healthcare information processes.
Over 18,000 financial services and healthcare organisations around the world manage and account for their investments using SS&C’s products and services.
SS&C has a history of acquisitions and views Mainstream as an attractive opportunity to accelerate its growth, particularly in the Australian market.
Share price snapshot
Mainstream is a fund administrator for fund managers, superannuation trustees, and listed companies with a focus on the Asia-Pacific region. The company has over 362 clients and 1,202 funds with over $224 billion in funds under administration.
The Mainstream share price rebounded strongly from its COVID lows of 25 cents to all-time record highs of $1.250 last Wednesday.
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Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of MainstreamBPO Limited. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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