MYOB steps closer to $2 billion acquisition after failing to find a better offer

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MYOB steps closer to $2 billion acquisition after failing to find a better offer
MYOB's Tim Reed

MYOB has come one step closer to a buyout by US private equity firm KKR after failing to find a more attractive offer.

KKR offered to buy MYOB shares  it didn't already own for $3.40 each, valuing the accounting software firm at $2.01 billion.

MYOB's directors agreed in part to support the acquisition but only after a 60-day "go shop" period which allowed the company to seek a better offer. KKR agreed to sell its shares or vote in favour of a superior proposal if an offer at least five percent higher than its own offer is made.

The go shop period expired today with no better offers appearing. As a result, MYOB's directors reaffirmed their recommendation for shareholders to vote for the deal.

There's a way to go before the transaction concludes: the deal must go to court to satisfy the Corporations Act  and shareholders need to vote on the scheme. Documents posted in late 2018 outlined a process expected to start on March 11th and end on May 3rd.

KKR had initially offered to buy MYOB's remaining shares for $3.77 each, valuing MYOB at $2.2 billion, but that offer was knocked down after the investment firm completed due diligence and finalised its debt funding commitments. KKR already owns 19.9 percent of MYOB.

This week, MYOB also announced its 2018 results, showing it had smashed passed the half-a-million subscriber milestone and was already sitting on 628,000 total subscribers as of 31 December.

EBITDA remained stable at $190 million, whole net profit after tax, MYOB's preferred measure of success, was up two percent to $104 million.

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