K2fly board, major shareholders endorse $38m buyout offer from Accel-KKR

K2fly (ASX: K2F) has entered into a $38 million binding scheme implementation deed with a wholly-owned subsidiary of tech-focused investment firm Accel-KKR.

The K2fly board and major shareholders have backed a scheme of arrangement under which Accel-KKR will acquire 100% of the shares in K2fly for $0.19 cash per K2fly share.

The takeover offer follows the completion of a strategic review of the mining resource governance supplier’s business undertaken by specially appointed financial advisors.

‘Best interests’

After assessing the results of the strategic review, the K2fly board has announced it considers the scheme to be in the best interests of K2fly shareholders.

The board said the offer provides certainty of value through the 100%-cash consideration at an attractive offer price that represents a 90% premium to K2fly’s $0.10 share price on 20 June 2024.

The K2fly directors, who represent approximately 19.9% of the issued share capital in the company, have – with the usual caveats – unanimously recommended shareholders vote in favour of the scheme.

Major shareholder support

Significant shareholders, who hold 48.5% of K2fly’s current voting shares, have advised the company that they intend to vote in favour of the scheme.

These shareholders include Maptek (representing 17.6%), Regal Partners (10.3%), Tribeca Investment Partners (10%), CSBP (7.3%) and Nicholas Axam (representing 3.3%).

“In the last five years, K2fly has proven there is strong demand for our industry-first resource governance solutions across the biggest mining companies in the world,” chief executive officer Nic Pollock said.

“We are really excited at the prospect of partnering with such a prestigious partner as Accel-KKR to take us into the next phase of our global growth of products and markets.”

“Accel-KKR has demonstrated a unique understanding of software businesses like K2fly and demonstrated the ability to take them to the next level of maturity and growth.”

Sucessful strategy

“This offer from Accel-KKR affirms the success of the K2fly business strategy and the quality of its management team to take the business forward,” added Accel-KKR managing director Dean Jacobson.

He noted K2fly’s success as a result of its differentiated product in sectors with strong industry tailwinds.

“Highly complex and regulated sectors such as mining, utilities and [energy] are increasingly facing pressures to do right on behalf of their customers, employees and other stakeholders.”

“K2fly’s robust governance, tracking and reporting can result in stronger compliance, higher operational efficiency, better stakeholder transparency and generally be a vital competitive advantage for companies that operate in these industries.”