The deadline for supply chain finance technology provider Tradeshift to decide whether it will formally offer to buy Finnish-listed e-invoicing firm Basware is looming with just over a month to go before the company is expected to make its final call.
Investment fund Arrowgrass – a shareholder with directly and indirectly 24.8 percent of the shares in the Finland-based e-invoicing firm – set the deadline of 28 February this month along with a number of other conditions Tradeshift must meet before it would support the fintech’s acquisition plans.
The cut-off date marks an extension to the original 14 January deadline set last December, according to a mid-January statement from Arrowgrass.
Tradeshift’s next step will be closely monitored by the market, with any takeover of Basware having the potential of removing a competitive player from the e-invoicing market.
Basware is an established presence in the supply chain finance world, with reported net sales of €149 million in 2017 and global clients such as beverage company Heineken and engineering firm ABB Global Solutions.
In the 16 January statement, Arrowgrass said it would give Tradeshift an “irrevocable undertaking” that it would accept a tender offer from the company by the end of February, pending certain requirements.
The fund stipulated any tender offer has to be at least 46.50 euros per share and must be completed no later than three months after the offer is announced. With Basware holding a total of 14,401,936 shares, this offer would equate to around €669.7 million.
It said its support was also reliant on no other offer being made that is more than 30 percent higher than the minimum offer price.
Heightened media speculation towards the end of last year pushed Basware to confirm last November that it had been approached with a “non-binding and highly conditional indicative proposal for a possible tender offer for the entire share capital” of the company.
Within a few days of that announcement, the firm named Tradeshift as the company behind the “indicative proposal”.
In December, at the request of Nasdaq Helsinki, Basware issued a further statement saying that it was Tradeshift’s intention to launch a public tender offer of €48 per share in cash for the entire issued share capital of Basware. It also clarified to shareholders that there was no assurance that a tender would be launched with this pricing.
Tradeshift declined to comment on the current state of negotiations, telling SCF Briefing it had “no comment on the Basware deal”.
Both Basware and Arrowgrass did not respond to SCF Briefing requests for comment.
Tradeshift released some details this week on its financial performance in 2018, reporting that it added more than 100 new customers last year, including Hertz and Shiseido. It said new bookings in the final quarter of the year grew 250 percent year on year, and new contract value rose by $54 million.
It also confirmed that in May last year, it raised $300 million in a series E funding led by Goldman Sachs and Public Sector Pension Investment Board. Other participants in the funding include HSBC, H14, GP Bullhound, and Gray Swan – a new venture company set up by the founders of Tradeshift.
Tradeshift’s funding now stands at more than $400 million, with a company valuation of $1.2 billion, according to a press release.
Its strong financials could provide a springboard for Tradeshift to consider snapping up other tech firms. It has already demonstrated an appetite for acquisitions having acquired Babelway, a cloud integration technology company, last December for an undisclosed amount.