Francisco Partners invests $248m in Australian software firm(2)

US-based Francisco Partners has agreed to acquire an Australian software firm in which Colonial First State has a 28 percent stake.

Francisco Partners, a US technology buyout firm based in Menlo Park, has agreed to acquire Mincom, an Australian software company that sells to asset-intensive industries, for A$315 million ($248 million; €191 million).

Under the terms of the transaction, Francisco will acquire all the shares in unlisted Mincom for A$8.77 in cash per share, plus all share options for A$8.76 in cash. The offer represents a premium of 110 percent to the company’s most recently traded share price, according to The Australian, a local newspaper.

Mincom’s board has unanimously recommended that shareholders vote in favour of the acquisition “in the absence of a superior proposal”, according to a statement.

Mincom offers software solutions to industries spanning mining, utilities, defence and transportation. The unlisted public company, which has its headquarters in Brisbane, has two major institutional investors: Colonial First State and Caterpillar, who hold 28% and 11.2% respectively. The remaining shareholders are mostly current or former employees, according to the company website. As an unlisted public entity, the company shares are traded but Mincom is not listed on the exchange, a company spokeswoman explained.

Colonial First State, the private equity investment arm of the Commonwealth Bank of Australia, invested in Mincom in October 2002.

Bob Savage, Chairman of Mincom said: “This transaction is exciting news for all of our shareholders, many of whom are current or past employees, allowing them to realise the value of their investment at a substantial premium to the most recently traded share price for Mincom. The board unanimously supports this transaction and recommends that shareholders vote in favour of the acquisition.”

Richard Mathews, chief executive officer of Mincom said it would be: “business as usual for the day to day operations of Mincom. No changes to the management team, company name, head office location, or product strategy are anticipated, nor will there be any impact on our customers.”

The transaction is expected to close within the next 90 days.

Mincom was advised by the Caliburn Partnership and McCullough Robertson. Francisco Partners was advised by UBS and Allens Arthur Robinson.