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Volaris gets weighty shareholder support in Adapt IT takeover bid

By , Senior news journalist
Africa , South Africa , 26 Apr 2021

Volaris has received a binding offer from a significant number of Adapt IT shareholders, placing the company at an advantage in its attempt to control the JSE-listed specialised software provider.

The Canadian software group, which is facing a fierce challenge from Huge Group over the Adapt IT shares, announced on Friday that it had obtained noteworthy support for the deal after receiving irrevocable commitment from shareholders holding 44.4% of Adapt IT shares.

“The irrevocable undertakings from shareholders to date, referred to above, include an irrevocable undertaking from Blacksheep Master Fund Limited, who have confirmed their undertaking to vote in favour of the resolutions to approve the offer.

“The resolutions include resolutions to implement the scheme of arrangement and the resolutions to delist Adapt IT following either the implementation of the scheme of arrangement or the general offer,” Adapt IT said in a statement.

Volaris launched its bid to take control of Adapt IT earlier this month, offering to acquire more than 50% of the issued ordinary shares of Adapt IT for 650c per share.

The announcement of the binding offer came the day after Huge Group was forced to remove videos targeting Adapt IT shareholders, aggressively pushing them to accept its takeover bid.

Huge Group last week upped the ante in its effort to take control of the software services company with a series of videos that discredited the Volaris offer, while urging shareholders to accept its bid.

The JSE-listed Huge Group company also took a swipe at the Sbu Tshabalala-led executives, saying the Volaris deal only benefits senior Adapt IT executives.

Adapt IT CEO Sbu Shabalala.
Adapt IT CEO Sbu Shabalala.

“Huge Group is building a world-class business, a business that will make South Africa proud. That’s why we made the offer to merge with Adapt IT and we want Adapt IT shareholders to participate in the upside going forward. The Huge offer is a shareholder-centred offer. It’s about you, the Adapt IT shareholder. One should ask, is the Volaris offer about you or is it about Adapt IT’s two most senior executives,” said Andy Openshaw, Huge Group chief operating officer, in one of the videos.

Huge Group launched its Adapt IT takeover bid in January, offering a swap ratio of 0.9 of a Huge Group share for every one Adapt IT share.

The swap ratio is based on a reference price of 613c per Huge share and an implied price of 552c per Adapt IT share.

The company says it is offering 33% premium on the shares.

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