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Netcall

  • BY: Andrew Hore |
  • POSTED: 01/06/2010 |

Netcall is making a recommended bid for Telephonetics and shares in both companies rose as a result of the deal.

Telecoms call-back and auto-messaging software provider Netcall is offering 0.3077 of a share and 5p in cash for each Telephonetics share. Netcall is raising £4.25m at 19p a share to help finance the cash cost of the bid, which is £5.46m. Netcall had £1.9m in the bank at the end of 2009. Telephonetics had net cash of £5.1m at the end of November 2009.

Discussions relating to the bid started in 2009. Telephonetics had previously considered a bid for Eckoh.

Shares in Telephonetics rose 1.25p to 8.5p each. At 15.25p a share, up 1.5p on the day, Netcall is valued at £9.79m. That values the bid at 9.69p a share or £10.6m for the company. Prior to the share price rise the bid was valued at 9.23p a share.

Netcall already has undertakings from the owners of 57.42% of Telephonetics to vote in favour of the bid.

Telephonetics supplies speech recognition and voice automation products.
Telephonetics is strong in the health and public sector markets and recently agreed an extension to its MovieLine cinema ticket booking contract with Odeon. The Odeon contract lasts until 2015 and another cinema contract has been won in Ireland.

Telephonetics reported a fall in profit from £1.07m to £413,000 in the year to November 2009. This decline was a combination of lower interest income and higher costs.

The Netcall bid combines a return of capital to Telephonetics shareholders with a chance to continue to benefit from an enlarged business. There should be costs savings as well as a broadened product range.

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