Private equity firm Advent offers $1.58 billion cash for UNIT4

AMSTERDAM Mon Nov 18, 2013 7:54am EST

AMSTERDAM (Reuters) - Advent International offered 1.2 billion euros ($1.6 billion) to take UNIT4 (UNI4.AS) private, which the Dutch business software firm said would help it speed up expansion without the pressures of being listed on the stock market.

UNIT4 shares jumped more than 8 percent to a high of 38.18 euros on Monday, just short of the 38.75 euro per share cash offer from Advent, a private equity firm that invests in technology and software businesses.

Advent's offer represents a 32 percent premium to UNIT4's shares on October 11, before the company said it had been approached by potential buyers.

The Dutch company, which competes with firms such as Germany's SAP (SAPG.DE) and U.S.-based Oracle Corp (ORCL.N), and Workday Inc (WDAY.N), provides cloud computing and other business software services - known as SaaS - for private and public-sector customers.

UNIT4 counts utility EDF Energy (EDF.PA), the City of Oslo and SEUR, the leading express courier firm in Spain and Portugal among its clients, according to its website.

"UNIT4 has the opportunity to become a global leader in mid-market ERP (enterprise resource planning)," Fred Wakeman, Managing Partner of Advent, said in a statement.

The company has more than 4,300 employees in Europe, North America, Asia and Africa, and reported EBITDA (earnings before deduction of interest, taxation, depreciation and amortization) of 86.2 million euros on revenue of 469.8 million euros last year.

UNIT4 said Advent's offer values it at 18.1 times EBITDA adjusted for capitalized research and development costs and investments in FinancialForce.com, a cloud applications company.

Similar deals in the sector were done at lower multiples of between 11 and 15, said Oppenheimer Managing Director and head of EMEA Technology & Telecoms Investment Banking, Xavier Moreels. Oppenheimer advised UNIT4.

SHORT-TERM PAIN

Advent has been investing in technology and software businesses for more than 20 years, and its current portfolio includes KMD, one of Denmark's largest IT and software companies.

Last month it also acquired U.S.-based P2 Energy Solutions, a provider of software and data to the oil and gas industry.

UNIT4 said it needed more investment to expand its cloud computing and Saas business, a move that would initially hit revenue and profitability and would be easier to carry out away from the stock market where pressure from investors for short-term results would likely hurt its shares.

Companies are increasingly turning to cloud computing - an umbrella term for technology services offered remotely via the Internet instead of on-site - to cut costs and add flexibility to their IT departments.

The billing structure for cloud computing is basically subscription-based, Chris Ouwinga, UNIT4 founder and co-chief executive, told reporters on a conference call.

"That would defer a large part of our revenue and as a result the profitability would be hit in the shorter term, in the first couple of years. In order to make that transition, it is easier to work in a private setting," he said.

While UNIT4 recommended Advent's offer to shareholders, it also left the door open to substantially higher offers. But some analysts said a rival bid was unlikely.

"The likelihood for a higher bid is ... small, as there has already been a structured sale process," said Rabobank analysts Hans Slob and Frank Claassen in a note to clients, describing Advent's offer as fair.

ING and Oppenheimer are financial advisors to UNIT4, while ABN AMRO is independent financial advisor to UNIT4's supervisory board, and Goldman Sachs is financial advisor to Advent.

($1 = 0.7421 euros)

(Reporting by Sara Webb, additional reporting by Kylie MacLellan in London; Editing by Erica Billingham)

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NASA adds more space launch platforms for sale to private firms

By Irene Klotz

CAPE CANAVERAL, Florida | Tue Aug 20, 2013 7:11pm EDT

CAPE CANAVERAL, Florida (Reuters) - While NASA considers competing bids to take over a shuttle launch pad at Kennedy Space Center, it added three mobile launch platforms to its list of excess equipment available to private industry, officials said on Tuesday.

Ideally, NASA wants a commercial launch company to take over one or more of the massive steel platforms, which were originally built in 1967 to support the Apollo moon program's Saturn rockets. The 25-foot (7.6-meter) tall platforms were later modified for the space shuttles, which flew from 1981 until 2011.

Recycling the platforms, which measure 160 feet by 135 feet is another option, a solicitation on NASA's procurement website shows.

The U.S. space agency also is interested in other uses for the mobile launch platforms, which served as bases to stack and assemble the shuttle and then transport it to the launch pad. The platforms provided power and umbilical connections and had open sections for flames and rocket exhaust to pass through.

"At this point, NASA is looking to gauge interest for potential use of the (platforms) and concepts for potential use," spokeswoman Tracy Young said.

Proposals are due September 6.

NASA is already assessing bids for the shuttle launch pad from two competing firms backed by Internet billionaires.

NASA is also turning over the shuttle's runway to Space Florida, a state-backed economic development agency. Space Florida, in turn, plans to make the runway and support facilities available to a variety of commercial companies, including privately owned XCOR Aerospace, which is developing a two-person, suborbital spaceship called Lynx that takes off and lands like an airplane.

Another potential customer is Stratolaunch Systems, an orbital space vehicle backed by Microsoft co-founder Paul Allen.

The most contentious - and highest profile - piece of shuttle equipment available is a Kennedy Space Center launch pad that has attracted competing bids from Amazon founder Jeff Bezos, and Elon Musk, co-founder of Paypal and chief executive of electric car company Tesla Motors.

Bezos and Musk, both billionaires, are vying for Launch Complex 39A. NASA intends to keep the second shuttle launch pad, 39B, for a new heavy-lift rocket under development called the Space Launch System.

Musk's Space Exploration Technologies of Hawthorne, California, wants 39A to launch its Falcon 9 and planned Falcon Heavy rockets. The privately owned firm, also known as SpaceX, already flies from a leased launch pad at Cape Canaveral Air Force Station, located just south of the Kennedy Space Center.

The first Falcon 9 rocket flight from a new launch site at Vandenberg Air Force Base in California is scheduled for next month. The company has a backlog of more than 50 launches, including 10 missions to fly cargo for NASA to the International Space Station.

SpaceX also is developing a version of its Dragon cargo ship to fly astronauts.

Startup Blue Origin, a Kent, Washington, firm owned by Bezos, submitted an alternative proposal to NASA to run pad 39A as a multi-user facility.

Both firms say they are ready to take over maintenance and operations of the launch pad on October 1.

United Launch Alliance, a partnership of Boeing and Lockheed Martin, did not bid on the shuttle's launch pad, but has publicly endorsed Blue Origin's proposals. The company, which has a lucrative monopoly on launching U.S. military satellites, is facing its first competition for the business from rival launch pad bidder SpaceX.

The main NASA facilities that will remain are the shuttle launch pad 39B, plus various hangars for the Orion deep space capsule to be launched by NASA's heavy lift rocket, due to begin test flights in 2017.

(Editing by Philip Barbara)

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