Pegasus Group Plc, the UK-based accountancy software company, has accepted a 29.9m pound ($46.4m) offer from Solution 6 Holdings Ltd, the acquisitive Australian software group.
The 430 pence a share offer disappointed a market that had been expecting a higher price following the announcement by Pegasus in September that it was in talks with a number of different parties (CI No 3,746). But Pegasus, fatally weakened by the cost of upgrading its software to 32-bit Windows compatibility and competing in a market dominated by Sage Software, has a poor financial record and was in no position to drive a hard bargain.
Sydney-based Solution 6, Australia’s second-largest software developer, has already made 10 acquisitions this year and focuses on systems for the international accounting profession. From its point of view, Pegasus is a good buy as its software has always been highly regarded, but the company was held back by a poor marketing organization.
Solution 6 is currently gearing up for a Nasdaq listing, primarily to get the kind of highly-rated paper that will enable it to continue its buying spree, particularly in the US market (CI No 3,782).