Adapt IT appoints Nodus Capital to examine Huge Group offer

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Nodus Capital has been appointed by Adapt IT as an independent expert to scrutinise the fairness of the Huge Group’s bid to take over the software services company.

JSE-listed Adapt IT announced yesterday that Nodus Capital will submit recommendations to the recently constituted independent board, which will then form its own opinion regarding whether the proposed transaction is fair and reasonable to Adapt IT shareholders.

Adapt IT signalled two weeks ago its willingness to continue buyout negotiations with Huge Group by appointing a four-member board to assess the R800 million bid offered for all its shares.

The board consists of Craig Chambers, Oliver Fortuin, Zizipho Nyanga and Catherine Koffman.

The company added the board will appoint an independent expert to issue a report on the general offer, and to express an opinion on whether the terms and conditions of the deal are fair and reasonable to Adapt IT shareholders.

Huge Group, whose subsidiaries operate in the telecommunications, media, technology and software industries, is offering a swap ratio of 0.9 of a Huge Group share for every one Adapt IT share tendered.

The swap ratio is based on a reference price of 613c per Huge share and an implied price of 552c per Adapt IT share.

Huge Group made a shock takeover bid last month, offering a 33% premium on the Adapt IT shares.

The company has since procured irrevocable undertakings from its shareholders holding 79.57% of the issued share capital to continue with the acquisition.

Yesterday, Adapt IT said: “The independent board will provide its advice to Adapt IT shareholders regarding this matter as soon as possible, and the opinions of the independent expert and the independent board will be sent to Adapt IT shareholders in the Adapt IT response circular.

“This will be sent to the shareholders within 20 business days after the publication of the Huge Group’s offer circular to Adapt IT shareholders, which is due to be published by 3 March 2021 unless the Takeover Regulation Panel receives and grants a request to extend this date.”

Adapt IT independent non-executive chairman Craig Chambers points out: “Adapt IT has cautioned its shareholders to not make any decisions, take any actions or provide any undertakings in relation to the Huge offer until they have the benefit of the opinions of the independent expert and the independent board.

“Adapt IT has already begun drafting the Adapt IT response circular, in order to issue this as soon as practicably possible after the publication of the Huge offer circular.”

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