The Damstra Holdings Ltd (ASX: DTC) share price has been an incredibly strong performer on Thursday.
In afternoon trade, the enterprise protection software provider's shares are up 26% to 19.5 cents.
Despite this, the Damstra share price is still down 44% since the start of the year.
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Why is the Damstra share price rocketing higher?
Investors have been bidding the Damstra share price higher on Thursday amid reports that the company has been a takeover target.
According to the AFR, private equity firm Accel-KKR has been talking to Damstra in relation to a potential transaction. However, the report indicates that Accel-KKR has since walked away from talks without a deal being reached.
Interestingly, this is what happened with fellow tech share ELMO Software Ltd (ASX: ELO) last month. Accel-KKR was rumoured to have been the private equity firm that made the HR technology company a $6.10 per share indicative proposal. This was over double the ELMO share price at the time. However, talks ended before a deal could be made.
Damstra response
This morning Damstra confirmed that takeover discussions had taken place with Accel-KKR, but that they have now ended.
It commented:
[Damstra] refers to recent media speculation in relation to receipt of an unsolicited confidential, non-binding and indicative proposal (Proposal) from Accel-KKR. Discussions in relation to this Proposal have concluded.
The Board of Damstra will continue to explore options to maximise shareholder value, and will update the market in accordance with its continuous disclosure obligations under ASX Listing Rule 3.1.
Time will tell if Accel-KKR returns. But some investors appear to believe it will judging by the Damstra share price performance today.
