TietoEnator subject of takeover bid

Cidron Services, a company indirectly owned by the Nordic Capital Fund, has made a hostile takeover bid for the IT consultant company TietoEnator.

Cidron has made a cash offer of €15.50 ($23.93) per share, valuing TietoEnator at approximately €1.1 billion.

The offer constitutes a 38 percent premium compared with TietoEnator March 19th closing share price of €11.27 per share.

The offer will start on April 2nd and run until April 28th.

Once the offer is fulfilled, TietoEnator would be delisted and Cidron Services intends to appoint Harri Koponen as the chairman, according to a statement from Cidron Services.

Cidron Services doesn’t currently anticipate that its plans for TietoEnator will affect the latter’s personnel or locations in a way that would essentially diverge from TietoEnator’s previously announced program for improving profitability.

The offer is conditional on being accepted by stockholders representing at least 90 percent of the shares and votes in TietoEnator.

Cidron Services claims that the challenges facing TietoEnator demand a quicker pace in the restructuring program already underway. The company writes further that a strengthening of TietoEnator’s long-term competitiveness will come at the cost of short-term profitability, which doesn’t suit a publicly listed company.

The board of TietoEnator will evaluate the offer and examine other alternatives, according to a statement.

“While we will investigate the matter in detail, the preliminary view of the Board is that the Offer, which is unsolicited, does not reflect the true value of TietoEnator shares”, said board chairman Matti Lehti in a statement.

Cidron’s offer of €15.50 per share of TietoEnator is equivalent to a share price of 145.70 kronor.

Once word of the offer reached the Stockholm stock exchange, TietoEnator shares rose sharply, climbing 42 percent by 9.25am to 150.50 kronor.

TietoEnator shares hovered near the 150 kronor mark much of the day, signaling that the market expects a higher bid for the company.


Scania bosses made pre-bid shares purchases

Two top Scania bosses made substantial shares purchases in the Swedish truck making company three weeks before majority owner Volkswagen made its take-over bid.

Scania bosses made pre-bid shares purchases
Scania CEO Martin Lundstedt. File photo: TT

Business daily Dagens Industri (DI) reported on Tuesday that CEO Martin Lundstedt bought a large number of shares on January 30th, several weeks before the offer was made. If the Volkswagen bid were to be accepted, Lundstedt would make 1.7 million kronor in profit, DI calculated.

Also finance head Jan Ytteberg bought shares on the same day to the tune of a half million profit in case of a successful German take-over. 

Due to their standing and insight into the company's affairs, Lundstedt and Ytterberg must by law report any changes to their shares portfolio to Sweden's Financial Supervisory Authority (Finansinspektionen – FI). 

"If you have insider information you cannot act based on that information regardless of whether you report the transaction to us or not," trade survey unit head Johan Allstrin told the TT news agency on Tuesday.

Any criminal probe, however, would be instigated by the Swedish police's financial crimes division.

As rumours were already swirling that Volkswagen would try to up its stake in the Södertälje-based company, some observers said they were surprised the two top managers would even ponder making such shares purchases. 

"It's remarkable that such high-level bosses dared go in and trade," net broker Avanza spokesman Claes Hemberg said about the the case. "They probably did not know about the bid, as then they wouldn't have had the courage to do so, but they should have been thinking long-term."