Hytera, the Chinese professional mobile radio solutions provider, finally decided today (16 December 2016) to put in an offer to buy Cambridge, UK-based communications technology company Sepura Plc. An announcement was made to the London Stock Market earlier today confirming the offer after several weeks of discussions.
In a statement Hytera confirmed to the Sepura board that the offer is to be solely in cash and the Sepura Board of Directors has made a recommendation that the offer be accepted.
The statement continued: ‘The offer and its impact on all Sepura Plc stakeholders will now need to be carefully considered by Sepura shareholders before a final decision is made.
‘As part of this process, an information pack outlining the terms of the offer will be issued to Sepura Plc shareholders in January, ahead of a general meeting to be held in February.’
Commenting on the offer, Alan Lovell, Chairman of Sepura, said: ‘This transaction with Hytera recognises the underlying strengths of Sepura’s technology and customer base. It will provide certainty for our stakeholders, and secure the future of the business. There will be additional opportunities and benefits for the business and its employees as part of a larger group.’
He added: ‘In the meantime, it is business as usual for Sepura, and we will continue to provide our customers and partners with consistent, high-quality service and support.”
Chen Qingzhou, chairman and chief executive officer of Hytera, said:’We are very pleased to reach this agreement with Sepura. The industry in which we operate is undergoing significant changes and Sepura represents an excellent strategic fit for Hytera and will allow us to expand the range of products and services we provide to our clients around the world.’
- Under the terms of the Acquisition, each Sepura Shareholder will be entitled to receive:
- 20 pence in cash per Sepura Share?
- The Acquisition values the entire issued and to be issued ordinary share capital of Sepura at approximately £74 million.
- The Acquisition Price represents a premium of approximately:
? 35.6 per cent. to the Closing Price of 14.75 pence per Sepura Share on 3 November 2016 (being the last Business Day prior to the announcement that Hytera and Sepura were in discussions and the commencement of the Offer Period); and
? 30.5 per cent. to the average Closing Price of 15.33 pence per Sepura Share for the one month period to 3 November 2016 (being the last Business Day prior to the announcement that Hytera and Sepura were in discussions and the commencement of the Offer Period).
Full details of the binding offer are available on the investor section of the Sepura website www.sepura.com/investors
Hytera was founded in 1993 in Shenzhen, China, and specializes in professional mobile radio (PMR) solutions for the TETRA, DMR and PDT radio standards. It acquired the TETRA business of German communications firm Rohde & Schwarz in 2011.
Hytera is the first Chinese PMR company to break out of its home territory and is now has customers in more than 120 countries and regions across the world. In China, Hytera's market share ranks 1st among Chinese manufacturers; globally Hytera has reached the 2nd in Overall Terminal category.
Sepura was founded in the UK in 2002 and designs, manufactures and supplies digital radio products, systems and applications developed specifically for business and mission critical communications.
It has acquired a number of companies in recent years including: Austrian TETRA infrastructure provider 3T Communications in 2012; Finnish applications developer Portalify in 2013; UK radio trunking solutions provider Fylde Micro in May 2014; and Spanish PMR manufacturer Teltronic in May 2015.
The latter acquisition has proved to be expensive and is one of the reasons for Sepura’s hugely increased debt – one of the reasons which has become open to potential takeovers.
The company now focuses largely on TETRA radio solutions after its bid to enter the Digital Mobile Radio (DMR) market was derailed by its spiraling debt situation. The Teltronic acquisition added LTE broadband technology to the Group’s portfolio.
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