Vebnet shares more than doubled following a recommended bid from Standard Life.
The shares jumped 132p to 253.5p. That is still just short of Standard’s 260p a share bid, which values the employee benefits technology developer at £24.2m. The share price has never been as high as the bid price. Standard has irrevocable acceptances totalling 50.5%. It also has non-binding letters of intent to accept for a further 26.4%.
Vebnet is a provider of technology and managed services for reward and flexible benefit programmes. It was founded in 2000 and reversed into a shell in 2003.
Standard argues that the employee benefits packages are becoming more sophisticated. Standard is adding flexible benefits and online reward options to its Employee Wealth Plan. Acquiring Vebnet will help in this process. It will also widen Standard’s client base and help it to expand internationally. Vebnet will still offer its services under the Vebnet brand to outside customers.
In the year to June 2008, Vebnet increased its profit from £490,000 to £907,000 and revenues rose from £5.25m to £6m. Net cash was £3m.
Management says that the potential sales pipe line is strong. Even so, Standard appears to be paying a full price for Vebnet but it should be able to do more with the business than Vebnet could as a standalone company.
© 2021 Aim Micro. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.