Although Cray Electronics Plc’s hostile bid for SD-Scicon, sprung on the systems software house on Friday is not being considered seriously by the company, British Aerospace – which has a 25% shareholding in SD-Scicon – has, according to Cray, agreed to support the offer. The offer is an 11 for 20 share swap valuing SD-Scicon at about UKP110m. The bid is a final offer, which means that it will only be increased should SD-Scicon make a recommended deal or should a rival bidder enter the field. Cray, which these days has the look of a brand new company, having appointed a new management team in 1989 and implemented a heavy disposal programme, is now firmly focused on telecommunications, instrumentation and software, and evidently believes that SD-Scicon would fit nicely into the company’s corporate strategy. The company seems proud of its achievement in turning itself around over the last year, and now feels that it could do wonders for the ailing software house. Cray, confidently assuming that its offer will be accepted, intends to combine its software systems division with SD-Scicon and address urgently the fundamental issues of SD-Scicon’s products, markets and management. It is unlikely, however, that Cray – in its ruthless attitude of disposing with anything that doesn’t smell of its own blood – would hold on to SD-Scicon’s US vehicle emission testing business should the acquisition go ahead, something which is not going to entice SD-Scicon into making any rash decisions. Cray expects to turn in pre-tax profits of around UKP3.2m for the year to April 30 and earnings per share of 2.2 pence. A cash alternative of 37 pence per SD-Scicon ordinary share and 80 pence per preference share IS also on offer.
