Altium (ASX:ALU) share price shoots 40% higher on takeover approach

This tech company has received a takeover approach but its board isn't biting…

| More on:
asx share price increase represented by golden dollar sign rocketing out from white domes of lithium

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Altium Limited (ASX: ALU) share price has commenced trade later than normal on Monday and is shooting higher.

At the time of writing, the electronic design software company's shares are up 40% to $38.00.

What's happening with the Altium share price today?

This morning the Altium share price was paused earlier today pending the release of an announcement.

That announcement has now been released and reveals that the company has been the recipient of an opportunistic takeover approach.

According to the release, Altium has received a formal, non-binding, indicative and unsolicited proposal from US giant Autodesk, Inc. (NASDAQ: ADSK) for the acquisition of 100% of Altium shares at $38.50 per share by way of a scheme of arrangement.

While this represents a 41.5% premium to its last close price of $27.21, it is also a 4.2% discount to its 52-week high.

Autodesk is a US$62 billion US-based multinational software company that makes software products and services for the architecture, engineering, construction, manufacturing, media, education, and entertainment industries.

What was the Altium response?

The Altium Board has responded to the offer by stating that it appreciates the interest expressed by Autodesk, which has evolved from a dialogue about a strategic partnership.

However, it believes the proposal significantly undervalues Altium's prospects and therefore rejects the proposal at the current price.

The Altium Board also highlighted that the proposal is non-binding, was unsolicited and is subject to Autodesk performing satisfactory due diligence as well as other conditions. This includes the unanimous support of the Altium Board, which this offer has not received.

Commenting on the future, the Board said: "Altium's strong track record of setting ambitious long-term goals and achieving them, gives the Altium Board confidence in the Company's ability to pursue its transformative strategy for the electronics industry and to achieve its 2025 financial goals. Having successfully pivoted to the cloud, Altium is now well positioned to pursue market dominance and industry transformation. The adoption of Altium's cloud platform is transforming Altium's business model from maintenance-based subscription to capability-based SaaS subscription."

The Altium share price is now up 10% year to date following today's gain.

James Mickleboro does not own any shares mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Altium. The Motley Fool Australia owns shares of and has recommended Altium. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Mergers & Acquisitions

A man sits in a chair hunched over a laptop and covered head to toe in frozen icicles to represent Envirosuite's trading halt
Mergers & Acquisitions

APM share price placed on ice as $1.8 billion deal goes dud

It's all question marks and raised eyebrows for shareholders of this ASX company today.

Read more »

Young man sitting at a table in front of a row of pokie machines staring intently at a laptop. looking at the Crown Resorts share price
Mergers & Acquisitions

Could Star Entertainment shares be next in line to catch a takeover bid?

Star shares have been battered, but could a buyout be coming?

Read more »

Contented looking man leans back in his chair at his desk and smiles.
Bank Shares

Own CBA shares? Here's the tech stock the banking giant just invested in

CBA has made an interesting investment. Here's what you need to know.

Read more »

Man pointing at a blue rising share price graph.
Mergers & Acquisitions

Guess which ASX 300 stock is rocketing 10% on a $985 million cash bid!

Investors are piling into the ASX 300 stock on the back of a $985 million cash takeover bid.

Read more »

Shot of a scientist using a computer while conducting research in a laboratory.
Mergers & Acquisitions

Guess which ASX blue-chip share is throwing $202 million at another acquisition

This Aussie healthcare company is growing its presence in Switzerland.

Read more »

A man stands with his arms crossed in an X shape.
Mergers & Acquisitions

Boral share price falls after rejecting Seven Group takeover

The offer 'undervalues' Boral according to its committee.

Read more »

Miner looking at a tablet.
Materials Shares

Mineral Resources share price marching higher on new lithium project acquisition

ASX 200 investors are bidding up the Mineral Resources share price on Monday.

Read more »

A man sitting at a computer is blown away by what he's seeing on the screen, hair and tie whooshing back as he screams argh in panic.
Technology Shares

Appen shares plunges 17% after takeover collapse

Well that didn't take long...

Read more »