The Nearmap Ltd (ASX: NEA) share price has jumped 30% after giving a FY22 update and receiving a takeover offer.
For readers that haven’t heard of Nearmap before, it’s an aerial imaging business that takes high-quality pictures for clients. An example of use can be so that an organisation’s management can get regular updates from a site without needing to visit.
Nearmap share price goes bananas
The ASX tech share revealed that it has received a ‘non-binding indication of interest’ from Thoma Bravo, a software investment outfit.
Thoma Bravo is one of the largest private equity businesses in the world, with more than US$114 billion of assets under management.
The offer for Nearmap is $2.10 cash per share. That offer values Nearmap at just over $1 billion.
It represented an 83% premium to the Nearmap closing price on 5 July 2022, being the day before the initial receipt of the proposal. It’s a 39% premium to the last closing Nearmap share price.
On 6 July 2022, the Nearmap board granted non-exclusive due diligence. Nearmap has now granted exclusivity to Thoma Bravo for seven days starting 15 August 2022.
Nearmap has agreed to pay Thoma Bravo an expense reimbursement fee of up to $3 million if a deal isn’t done between the two organisations, or Nearmap agrees to a takeover bid with another organisation, within six months.
The ASX tech share revealed that it has received other expressions of interest for the company.
FY22 update
Nearmap also told investors about some of its numbers ahead of the annual result release due on 17 August 2022.
The group annual contract value (ACV) portfolio is expected to be $159.9 million in consistent currency terms. That is at the top of its initial FY22 guidance of between $150 million to $160 million. This is up from $128.2 million at 30 June 2021.
It’s expecting to finish with a cash balance of $93.7 million.
Final thoughts on the Nearmap share price
For many years, Nearmap has been a business of promising potential. It seems Thoma Bravo has identified that and believes it’s an opportunity worth investing in.
The board seem happy to do a deal at the price that’s being offered, even though it’s not close to Nearmap’s all-time high. The investment landscape has changed in recent times.
If I were a shareholder, I’d be happy to wait until a firm offer comes through, though there’s no guarantee that it will. But, I do think it would be worthwhile investing the money into other leading ASX growth shares.
