Micro Focus surges after mystery bid

Steve Dinneen
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Micro Focus International saw its shares surge more than 10 per cent yesterday after it confirmed it has received a preliminary approach for the company.

The potential bidder was not named but Micro Focus has often been seen as a target for a private equity buyer, or for US firms IBM, Oracle or Microsoft. Another potential buyer could be Germany’s SAP, which it was linked to earlier this year.

A company statement said: “Micro Focus confirms that it has received a very preliminary, non-binding approach in relation to a possible offer for the company.

“The board is currently considering its response to the approach. There is no certainty that any formal offer for the company will be forthcoming nor as to the price at which any offer might be made.

“As a result of this approach the company is suspending its buyback programme until further notice.”

The embattled business saw its chief executive resign earlier this month after issuing a number of profit warnings in the last year.

Nigel Clifford stepped down with the firm struggling to overcome weak demand and problems with its software testing arm.

Earlier this year Micro Focus announced it would undertake a share buyback programme for up to £60m of its stock, funded out of the company’s existing cash balances and available debt facilities.

In February its shares plunged 26 per cent after it said that it would lose some large mainframe deals in its third-quarter and would not be able to make up the shortfall in the remaining three months of its financial year.

Last summer it was also hit by the departure of chief financial officer Nick Bray.



NUMIS Securities and UBS, Micro Focus’ retained advisers, are acting as joint book-runners on the bid.

Simon Willis is heading up the team for Numis.

Willis has been involved with the Micro Focus account for some time and has advised the technology firm on its recent share buyback programme, which has been halted while the bid is considered. Alex Ham also advises Micro Focus for Numis.

Adrian Haxby is heading up the team for UBS. Haxby is a managing director in UBS Investment Bank where he runs the UK mid cap corporate broking and advisory team. He has worked in London, Paris and Frankfurt, advising on M&A, rights issues, IPOs and other capital raising for listed firms.

In 1985 he moved to SG Warburg, which is one of UBS’ principal constituent firms in the UK.

He read Classics & Modern Languages at Oxford University before joining PwC in 1981.

He is a member of the UBS Community Affairs Committee.