Arrowgrass wants €46.50/share
Digital supply chain payments specialist Tradeshift is understood to be locked in ongoing talks to buy rival Basware, after the latter’s largest shareholder Arrowgrass Capital Partners extended its deadline for an “irrevocable offer” to February 28.
London-headquartered alternative asset manager Arrowgrass holds 24.8 per cent of shares and votes in Basware. On December 22 it agreed to an “irrevocable undertaking with Tradeshift to accept a tender offer by Tradeshift for Basware” should such an offer be forthcoming. It set an initial deadline of January 14, 2019.
That deadline was extended on January 16.
Tradeshift Basware Acquisition: Three Conditions Attached
The undertaking to accept an offer was based on three conditions: 1) a price of €46.50 per share for the Finnish e-invoicing company; 2) the deal closes within three months of acceptance and 3) no rival offer 30 percent higher supersedes it.
The figure (a 25.9 percent premium on Basware’s average closing price over the past five trading days) would value Finland’s Basware at a robust €669 million (£586 million), according to Computer Business Review’s calculations. Over 90 percent of Basware’s shareholders would then have to approve, as well as regulators.
If Tradeshift can finance the deal it would remove one of its major rivals from the e-invoicing and supply chain finance management market, and subsume a blue chip Basware customer base that includes ABB, McDonalds, Heineken, Toshiba and Toyota.
Tradeshift declined to comment. Arrowgrass did not respond to a request for comment.
Basware on November 20 acknowledged it had been approached with a “non-binding and highly conditional indicative proposal for a possible tender offer” by Tradeshift, but it had not “among other things, received any confirmation that the financing for the Indicative Proposal is appropriately secured and as there can be no assurance that the Indicative Proposal will result in a tender offer or any transaction.”
Cash-rich Tradeshift – fresh from a Goldman Sachs-led Series E funding round that raised $300 million and valued the company at $1.2 billion – has already made one acquisition on the back of the funding round, snapping up privately held cloud integration provider Babelway for an undisclosed sum in December 2018.
That deal allowed Tradeshift to bring in-house a service it has relied on extensively for the past six years. (Babelway’s Software-as-a-Service allows the exchange and transformation of documents in formats ranging from Amazon to Chorus Pro, CSV, FTP, email, Excelt, Edifact, Dropbox, UBL, Tradacoms, X400, XML and more.)
Today, meanwhile, Tradeshift reported another strong quarter, with new bookings up 250 percent year-on-year, new contract value hitting $59 million for the quarter and a record 49 new customers signed for the quarter, including HSBC and Econocom.
(The company had reported total contract value growing by $47 million in fiscal Q3 alone, as it added 27 new customers for the quarter.)
Privately held Tradeshift is not obliged to publish financial results, but with the digital supply chain payments specialist repeatedly asked by customers and analysts for insight into its growth, the company now publishes quarterly “momentum” releases.
“2018 was a record setting operational year for us,” said Christian Lanng, CEO and co-founder of Tradeshift in a release.
He added: “It’s been so gratifying to see huge Fortune 500 global companies recognize the transformation they can drive in their businesses by using the Tradeshift platform. The proof is in the numbers – the deals we sold this year were incredible.”