Sidney, Australia-based industry standards and risk compliance services company SAI Global Ltd (ASX: SAI), agreed to be acquired by funds controlled by Hong Kong-based Baring Asia Private Equity, for A$4.75 in cash, in a deal valued at A$1 billion ($761 million).
The offer price represents a 32.3% premium to SAI’s closing price of A$3.59 on September 23, 2016. The deal implies an enterprise value of A$1.24 billion, and an EV/EBITDA multiple of 9.4x. Baring Asia currently has a 4.3% equity interest in SAI.
“Baring Asia’s proposal is compelling and represents a significant premium to SAI’s share price,” said SAI’s chairman Andrew Dutton.
Baring Private Equity Asia is one of the largest independent alternative asset management firms in Asia, with offices in Hong Kong, China, India, Japan and Singapore, and over $10 billion in assets under management.
“We look forward to partnering with SAI’s management team to grow the company into a recognised leader in risk management solutions,” said Jean Eric Salata, founding partner and CEO of Baring Private Equity Asia.
The move comes after two years of takeover speculation, and is expected to improve SAI’s strained relationship with Standards Australia, the country’s non-government, not-for-profit standards organization, with which SAI has an exclusive licensing and publishing contract until 2023.
The SAI directors unanimously approved the deal and recommended that SAI shareholders vote in favor of the deal, concluding that it is in the best interests of SAI shareholders.
The deal is expected to close in mid/late December 2016, subject to shareholder, regulatory and court approvals, and other customary closing conditions. SAI agreed to be bound by customary exclusivity provisions including “no shop”, “no talk”, and “notification” obligations.
Credit Suisse is acting as exclusive financial advisor to SAI and Gilbert + Tobin is acting as legal advisor. KPMG is acting as independent expert.
Photo: Jean Eric Salata, Founding Partner and CEO of Baring Private Equity Asia.