VersaPay Corporation (TSXV: VPY) looks to be going private. The firm announced this morning that private equity firm Great Hill Partners has made an all cash offer to purchase all outstanding shares of the firm in a transaction valued at $126 million. The announcement follows a run in the equities price that occurred last week.
VersaPay Corp is a software focused firm who’s primary product is focused on billing and collections. The enterprise software organizes and semi-automates the accounts receivable departments of small and medium sized businesses.
Under the proposed arrangement, VersaPay shareholders will receive $2.70 per common share held of the equity, which is a 45% premium to yesterday’s closing price of $1.83 on the TSX Venture. The proposed price is also a 64.5% premium to the 30 day volume weighted average price of the equity, demonstrating that a run up has occurred as of late.
A termination fee of $5.67 million is payable by VersaPay should they elect to accept a superior offer. Comparatively, Great Hill is subject to a fee of $7.56 million should they elect to walk from the transaction in certain undisclosed circumstances.
A special meeting for shareholder approval is expected to occur in February 2020, where 66.7% of shareholders will be required to approve of the transaction. Current insiders that collectively hold 3.7% of shares have voiced approval of the transaction.
The proposed transaction is expected to close by the end of the first quarter of 2020.
VersaPay last traded at $1.83 on the TSX Venture.
Information for this briefing was found via Sedar and VersaPay. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.