Softline shareholders likely to take R2
September 22, 2003
By Nicky Smith
Johannesburg - Shareholders in Softline, the listed accounting software company, are expected to put forward little resistance to the offer of R2 a share from Sage Group.
Shareholders will meet tomorrow to vote on the Sage offer, which is likely to bring to an end the four-month battle for Softline.
Steve Minnaar, an information technology analyst with Old Mutual Asset Management, which holds about 11 percent of Softline, said:
"The bottom line is either you take the R2 and walk away or you get active. I suspect most people will take the R2."
He said that since the rival Dutch consortium of Exact/ Ferrer, which is fronted by former Softline director Ivan Ferrer, had decided after completing its due diligence not to put in a bid higher than Sage's offer, it was unlikely that any of the other institutions would fight the Sage offer.
It appeared, he said, that Exact/Ferrer had decided it would not be able to make a go of the business above the R2 price tag and so it was unlikely that asset managers would have very much more success.
Anthony Sedgwick, a fund manager with Polaris Capital, which held about 7 percent of Softline before it sold its interest a couple of weeks ago, agreed it was unlikely shareholders would oppose the offer.
"I still believe that Sage at R2 is getting a great deal," he said.
"I think [Softline] is worth more, but that depends on perspective."
A circular was posted to shareholders on September 1 detailing the arrangements for the disposal, delisting and winding up of the company.
In April a consortium of Softline's management and Investec announced it would be offering shareholders R1.30 a share for the business. The response from the market was angry, with many describing the offer as opportunistic.
Two months later, Ferrer arrived on the scene with a potential offer of R1.45c share.
Shortly after this, Sage announced it would consider paying R1.85 a share subject to a due diligence. This was revised to R2.
Softline shares closed unchanged at R1.95 on the JSE Securities Exchange on Friday.
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