The All Ordinaries Index (ASX: XAO) is up a healthy 0.4% on Monday, but this ASX stock is leaving those gains wanting.
The fast-rising company in question is EnviroSuite Ltd (ASX: EVS).
Shares in the environmental management technology platform provider closed on Friday trading for 7.1 cents. During the Monday lunch hour, shares are changing hands for 8.6 cents apiece, up 21.1%.
Here's what's sending the ASX stock flying higher today.
Image source: Getty Images
ASX stock soars on takeover deal
Investors are sending the EnviroSuite share price soaring today after the ASX stock announced that it's entered into a Scheme Implementation Deed with Ideagen Limited to acquire 100% of EnviroSuite's shares by way of a Scheme of Arrangement.
Investors first learned of Ideagen's acquisition interest on 25 February with the announcement of Ideagen's non-binding, conditional and indicative proposal. And the ASX stock closed up a blistering 83.4% on the day.
If you're not familiar with Ideagen, the United Kingdom-based global software company specialises in providing governance, health and safety, risk management, and compliance solutions to a range of industries.
Under the terms of the Scheme, Ideagen is offering 9.0 cents a share to EnviroSuite shareholders, or 4.6% above current levels.
Management noted that this implies a fully diluted equity valuation of $132.2 million for the ASX stock. And it represents a premium of 109.3% to the last closing price of 4.3 cents a share prior to the announcement of Ideagen's non-binding, conditional, and indicative proposal on 24 February.
The board said it unanimously recommends that EnviroSuite shareholders vote in favour of the Scheme, in the absence of a superior proposal. They added that the takeover offer remains subject to Foreign Investment Review Board approval and other customary conditions.
Shareholders were informed that they do not need to take any action at the present time.
What did management say?
Commenting on the takeover offer sending the ASX stock surging today, non-executive chairman of EnviroSuite, Colby Manwaring, said: "The EnviroSuite board has carefully considered the proposed scheme and evaluated a range of factors and potential alternatives in arriving at its unanimous recommendation to vote in favour of the scheme, subject to the customary qualifications."
Manwaring added:
While the EnviroSuite board is highly confident in the long-term fundamentals and growth prospects of the company, we believe the scheme offers a compelling opportunity for shareholders to realise the immediate value of their investment in EnviroSuite, for 100% cash at an attractive premium to where EnviroSuite has recently traded.
