Five months after wrapping up a pre-bid stake and putting Tyro Payments in play, Potentia Capital’s finally set for a look under the fintech’s bonnet.
Tyro and Potentia have had their bankers and lawyers negotiating what exactly due diligence should look for the past week, and talking about restrictions on Potentia’s consortium should it enter the data room.
Tyro Payments chief executive Jon Davey said the company’s first half had been “exceptionally strong”. Both sides start this week happy that the issues were resolved, ending the stand-off and paving the way for due diligence to finally get underway. It’s not a moment too soon for Tyro shareholders, who have little to show for the round of takeover talks. Potentia kicked off the saga in September, locking up Grok’s stake and making an indicative bid at $1.27 a share, only for Westpac Banking Corp to join the fray with a higher non-binding offer.Advertisement, Tyro offered Potentia due diligence on January 26 to see whether it could help spark a “significantly improved proposal”.
Now that access to the data room has been sorted, the question is at what sort of price Tyro’s board would willing to sell.Morgan Stanley analysts put their two cents’ forward last week, telling clients Tyro was worth $1.60 or about four-times forecast gross profit on its base case basis. Its bull case has the stock at $2.50 a share, or five to six times gross profit.
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