Shares lift as potential new takoever bidders run the ruler over market data firm

New potential takeover suitors enter the fray for this market data firm.

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Key points

  • Iress has had more companies show interest in a potential takeover.
  • No proposals for a bid have been received as yet.
  • The company's shares are trading well below a previous potential offer price.

Financial data firm Iress Ltd (ASX: IRE) has opened its data room to new potential bidders for the company, but says there are no firm offers on the table as yet.

Iress was forced to make a statement to the ASX on August 8 about the fact that a potential buyer was sniffing around, after there was speculation in the media that a deal was in the wings.

Iress said at the time that it had considered an approach from Blackstone in relation to a potential takeover of the company at $10.50 per share, but that offer was withdrawn.

Iress shares are currently changing hands well shy of this figure, closing Thursday's trade at $8.40, valuing the company at $1.56 billion.

The shares jumped in early trade on Friday's news, however, up 4.8% to $8.80.

Iress said in August it was still engaging with Blackstone and Thoma Bravo "in order to ascertain whether an offer can be made which can be recommended by the Iress board''.

Deal potential still exists

Until this Friday, the company has had little to say about any potential deal, but told the ASX in a statement on Friday morning that new third parties had entered the mix, "in addition to the parties which have previously expressed interest in Iress''.

It went on to say:

To facilitate this engagement, Iress has, since the time of its previous update, made a virtual data room available to a number of additional parties under appropriate confidentiality agreements. The basis for engagement is that bidders are restricted from contacting certain former management (without Iress' consent).

Iress' former Chief Executive Officer, Marcus Price, stepped down on 4 September and will be replaced by Andrew Russell, who will join the company in November.

Iress delivered a steady set of first-half financial results in August, with revenue 3.1% lower at $299.5 million for the year and net profit steady at $17.3 million.

The company sold its superannuation business during the first half and, in September, completed the sale of its Quanthouse business for $31.3 million.

Mr Price said during the release of the first half report that the company's transformation process was now completed, and Iress would now focus on its growth drivers.

As we enter the next phase of our growth strategy, Iress is well-placed to capitalise on global growth opportunities, leveraging our core capabilities while selectively investing in new trading and wealth technologies.

Mr Price said the company saw "significant opportunities" in emerging cloud and artificial intelligence technology to enhance trading experiences for its customers.

Iress at the time reconfirmed its guidance of underlying net profit of $65 to $73 million.

Motley Fool contributor Cameron England has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Blackstone. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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