Norkom — which makes anti-fraud and money laundering software for financial services companies — announced in November that it had received expressions of interest and had entered discussions with a number of potential suitors.
Yesterday, the Dublin-headquartered company announced that it has reached initial agreement to be acquired by BAE Systems — the British-based defence, security and aerospace company. Pending shareholder approval, BAE will buy Norkom for around €217 million; which will see Norkom shareholders get €2.10 in cash for each of their shares. The Dublin firm’s share price rose by more than 36% on the back of yesterday’s news.
Irish venture capital firm, TVC Holdings, which owns nearly 27% of Norkom, stands to get nearly €42m from the sale.
Norkom’s senior management looks likely to remain in place, although its non-executive directors will step down after the conclusion of the deal.
The company’s current chief executive Paul Kerley said that the takeover by BAE will further strengthen Norkom, thanks to the British firm’s scale, reputation and resources.
“Norkom’s technology platform, together with BAE Systems’ complementary technology and rich knowledge of the security space, will create a fantastic opportunity to bring additional offerings to the market,” he added.
The Norkom board — which has been advised by investment bank, Jefferies International, in the deal — has unanimously recommended the offer to its shareholders.
The Irish company’s financial year runs to the end of March. The firm announced that it had received expressions of interest not long after publishing results (in November) for a difficult first half. Those results showed that its first half revenue — for the six months to the end of September — fell by 8%, on a year-on-year basis, with profits falling by a quarter of a million euro and earnings per share down by nearly 3c.