The Iress Ltd (ASX: IRE) share price is going bananas and is up over 12% after it received a takeover offer.
Iress is a technology company and provides software to the financial services industry. Its software offerings are used by more than 10,000 businesses globally.
Is Iress being taken over?
Iress said that it received a takeover offer at a price of between $15.30 and $15.50 per share.
The offer came from funds represented by EQT Fund Management (EQT). The offer was confidential, unsolicited and non-binding.
The Iress board said that following careful consideration it has rejected the offer as it was conditional and didn’t represent good value for shareholders.
However, Iress said that it was prepared to provide EQT with access to limited information so that EQT can put together an offer that is able to be recommended to Iress shareholders. The information has now been shared with EQT after it entered into a confidentiality and standstill agreement.
Iress said that discussions are continuing with EQT. Iress also said that there is no certainty that discussions will result in a revised offer from EQT.
EQT made a previous offer of $14.80 per share on 18 June 2021 which was rejected by the Iress board.
Other Iress news today
Iress also released other news to the market today.
The company said that it has launched a buy-back of up to $100 million shares. It expects to begin the buy back after its half year results in August 2021.
Management said that it is focused on enhancing earnings per share (EPS) and the share buy back is part of that strategy.
Iress growth plans
The company released a lengthy investor presentation today which outlines its strategy for growth.
Iress outlined some FY25 targets. It wants to grow revenue to at least $766 million, up to as high as $910 million. That compares to FY20 revenue of $542.6 million.
It has even bigger growth plans for net profit after tax (NPAT), with a goal to at least double NPAT by 2025 to $120 million. Iress thinks that it may even be possible to triple NPAT in that timeframe to $180 million.
Summary thoughts on Iress and the share price
Shareholders can feel validated in their investment in Iress with the takeover interest that has circled and the share price growing as a result, up over 12% at the time of writing.
It may continue to be good news for Iress shareholders with its growth plans looking promising. Time will tell if it can achieve the high growth it’s looking for by 2025.
With the current share price reflecting the takeover bid, I’m looking for good value elsewhere through other ASX growth shares with potential.
