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Non-public fairness group EQT has made an all-cash supply for Swedish software program group Fortnox along with the corporate’s largest shareholder and chair Olof Hallrup, sending shares up 35 per cent.
The bid, which values the corporate at $5.5bn, caps a tumultuous yr for Fortnox, an accounting software program specialist that operates solely in Sweden. Former chief govt Tommy Eklund resigned in August 2024 following scrutiny of the corporate’s accounts and disclosure practices.
The bidders have stated they won’t enhance their supply of SKr90 per share, with the corporate noting that the assertion was binding underneath takeover guidelines. Hallrup’s automobile First Kraft owned 18.9 per cent of its shares as of the top of final yr.
Quick sellers had drawn consideration to Fortnox’s very common buyer development and its accounting practices. Its shares fell greater than 12 per cent in March final yr after a report by the Monetary Instances.
One brief vendor stated they had been “gobsmacked” by the bid, provided that the corporate stated it had not disclosed any inside info to the bidder throughout the due diligence course of.
Critics have questioned the potential for gross sales development at an organization that dominates its residence market, in an business the place entrenched market positions and native accounting practices make cross-border mergers tough.
Roger Hartelius, a former chief monetary officer, is appearing as chief govt whereas the seek for a substitute continues. As a result of conflicts of curiosity affecting two Fortnox board members, the group stated it might search an opinion from accounting agency EY on the supply.
“With excessive expectations for the long run, mirrored in Fortnox’s present valuation, the consortium believes that Fortnox stands at a essential juncture, the place future development would require important funding in product growth and potential M&A initiatives,” stated Omega II, the automobile for the bidders.
Fortnox turned common amongst small- and medium-sized companies by partnering with accounting corporations that used the software program and beneficial it to their purchasers.
Up to now yr, it has confronted elevated scrutiny subsequent to Eklund rebranding the two-decade-old enterprise as a start-up. Earlier than he was appointed in 2020, it stated it served 40 per cent of the nation’s small companies.
Underneath Eklund, Fortnox virtually doubled its estimate of the scale of the addressable market, whereas reporting very common buyer development.
The proposed deal values the group at about 75 occasions consensus incomes estimates for this yr. A suggestion doc is anticipated to be printed in mid-Might, with shareholders prone to have till the center of June to simply accept.
EQT is a Swedish asset supervisor listed on the Nasdaq Stockholm index with a deal with personal fairness, enterprise capital and specialised funding funds.
