PRIVATE equity group Cinven has ended talks about a proposed £320 million takeover of Scottish cloud computing company Iomart, and declared that it is no longer considering an offer.
Cinven, which had been mulling a recommended cash bid for Iomart using its Host Europe Holdings vehicle, announced the ending of its interest in Iomart after the stock market closed last night.
Iomart did not issue any immediate response, but is likely to make a statement this morning. Its shares had surged previously on news of the Cinven bid talks. Shares in Iomart fell by 11.75p or 4.3 per cent to 262.75p yesterday, ahead of Cinven's announcement.
Cinven was in talks with Iomart about a bid of 300p-a-share, which would have valued the stake of the Scottish company's co-founder and chief executive, Angus MacSween, at more than £50 million.
In its statement last night, Cinven said: "On 19 August 2014, Host Europe Holdings Ltd confirmed that it had approached Iomart regarding a possible recommended cash offer.
"Host has subsequently terminated these discussions and confirms that it is no longer considering making an offer for Iomart."
Iomart has been a major success story among stock market-listed companies in Scotland in recent times, carving out a presence in the fast-growing cloud computing arena through organic growth and acquisitions.
Cinven said on August 19 that Mr MacSween, finance director Richard Logan and operations director Sarah Haran, with a total stake of 18.5 per cent in the Glasgow company, had indicated their support for its proposal. It added that the independent directors of Iomart had given their consent to these three executives working with Host to finalise its proposal.
Iomart co-founder Bill Dobbie, who was chief executive of Cupid and retains a seat on the board of the Scottish online dating company, had expressed support for the 300p-a-share proposal from Cinven, which would have valued his stake in Iomart at about £5.7m.
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