The Empired Ltd (ASX: EPD) share price has jumped firmly into the green today as French company Capgemini announced it has agreed to pay $233 million for the ASX-listed company.
Let's take a walk through this morning's events in a bit closer detail.
Quick recap on Empired
Empired is an IT services provider that has expertise in a raft of IT-specific domains, such as cloud services and data insights.
The company provides its services to a wide range of industries. It has two segments that operate in Australia and New Zealand.
At the time of writing, Empired has a market capitalisation of $209 million.
Capgemini's proposal
French multinational Capgemini announced this morning it proposed to buy 100% of Empired shares for $233 million.
The $1.35 per share bid represents a ~65% premium to Empired's closing share price on Friday.
Capgemini's proposal also values Empired at a "normalised EV/EBIT" multiple of 16.7 times for FY 2021.
Empired's board unanimously recommended that shareholders vote in favour of the proposal, claiming the scheme "is in the best interest of Empired shareholders".
Speaking on the proposal, Empired chair Tom Stianos stated:
After considering all the relevant factors, we believe this is a compelling offer for Empired shareholders. It provides shareholders with the opportunity to realise immediate value for their shareholding, at a significant premium to current trading levels.
Chief executive Russel Baskerville also weighed in:
If implemented, the Scheme will provide outstanding career opportunties for our people and have a positive impact for existing and prospective clients by providing them with access to the significant resources, service capabilities and international experience of Capgemini.
Baskerville intends to vote "all shares within his control" – around 5.8% of shares on issue – in favour of the proposal.
The market seems to have favoured the announcement, as Empired shares are now exchanging hands at $1.31, a 60% jump on the day.
Empired shareholders are expected to vote on the proposal in early October.
Empired share price snapshot
The Empired share price has posted a return of 92% since January 1. This has extended the previous 12 months' return of 273% into the green.
Both returns have outpaced the S&P/ASX 200 Index (ASX: XJO)'s return of ~21% over the past year.
