Takeover talk has hit tech town, with investment firm Potentia Capital Management having lobbed bids for two ASX shares – Nitro Software Ltd (ASX: NTO) and Tyro Payments Ltd (ASX: TYR).
Each of the offers – together worth more than $1 billion – was quickly rejected. Both companies said the firm's bid undervalued their business.
So, with Potentia seemingly on the hunt for a takeover and having had no luck so far, could other ASX tech shares be in its sights?
Let's take a closer look at the firm's apparent wish list and whether other stocks might fit the bill.
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Potentia's $1 billion bidding spree
Nitro and Tyro have both knocked back takeover offers from consortiums led by Potentia recently. The former rejected a $1.58 per share bid late last month and the latter refused a $1.27 per share bid yesterday.
And while they work in entirely different spaces, it's not difficult to draw parallels between the pair.
Shares in the respective ASX tech titans have fallen 30% and 57% year-to-date.
Interestingly, both companies dubbed Potentia's respective bids "highly opportunistic".
Nitro's chair said the firm's bid for the company was lobbed in a period of volatility among tech shares on the ASX and around the globe.
With that in mind, let's look at the pair's most recent results.
Tyro posted $318.8 million of payments revenue for financial year 2022 (FY22) – a 39% year-on-year increase. Meanwhile, Nitro boasted U$32.7 million of total revenue for the first half of the year – a 36% improvement on that of the prior corresponding period.
It appears Potentia might have a type. Both payment services provider Tyro and document productivity company Nitro boast thriving revenue, zero debt, and a sold-off share price.
And it's not hard to find other ASX tech shares that fit the bill.
Could these ASX tech shares be in Potentia's sights?
It's been a rough year so far for ASX tech shares, in which many have suffered major sell-offs.
For instance, the Pointsbet Holdings Ltd (ASX: PBH) share price has plunged 67% year to date. The company – which grew its revenue by 52% in FY22 and holds no debt – will be dumped from the S&P/ASX 200 Index (ASX: XJO) later this month following its sell-off.
Stock in BetMakers Technology Group Ltd (ASX: BET) has also tumbled 49% so far this year despite the debt-free company recently posting a whopping 371.1% increase in revenue.
Other ASX tech shares that fit the bill include Whispir Ltd (ASX: WSP) and Bigtincan Holdings Ltd (ASX: BTH).
The former posted record FY22 revenue while the latter's revenue simultaneously lifted 143%. Their stock has fallen 62% and 41%, respectively, so far this year.
