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Aconex Ltd trades flat as $1.6 billion Oracle takeover looms

Shares in takeover target Aconex Ltd (ASX: ACX) traded flat today just beneath the $7.80 per share cash takeover offer from US tech giant Oracle Inc. as the company handed in almost certainly its last set of results as an ASX-listed business.

For the record, Aconex posted a net loss of $2.95 million on revenues of $86.8 million for the six-month period ending December 31 2017. The net loss was an improvement on the $3.5 million in losses recorded in the prior corresponding half.

Total revenues for the year were up 13% or 14% on a constant currency basis, with EBITDA (operating income) from core operations clocking in 23% higher at $9.1 million.

As at December 31 2017 the company had cash in hand of $26.1 million.

The business is globally diversified with a potentially long growth runway thanks to the large addressable markets in which it operates. As a software-as-a-service business it also boasts some attractive characteristics in that it is capital light, can grow revenues faster than costs, and should generate recurring revenues.

Given its most recent set of financials I don’t expect there’ll be too many shareholders voting against Oracle’s $1.6 billion takeover proposal come the March 23 vote scheduled to approve the takeover deal. Fortunately for Aconex shareholders, A$1.6 billion is small change for the US tech giant, with the stock currently changing hands for $7.74, marginally below the $7.80 takeover price.

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Motley Fool contributor Tom Richardson has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended ACONEX FPO.

You can find Tom on Twitter @tommyr345

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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