The future of a takeover offer for small business accounting platform MYOB is uncertain after the company’s board said it could not support a revised bid with a cheaper price.
In October, private equity firm KKR Capital lobbed a $3.77 per share offer for MYOB, valuing the company at over $2 billion.
The MYOB board has spent the last few months running due diligence on a potential deal, but yesterday said a new offer, at a lower $3.40 per share, was not something it could support.
It is the third time KKR has changed its bid for MYOB, with the latest revision coming after the company had a chance to look more closely at MYOB’s books.
“The board has informed KKR that it is not in a position to recommend the revised proposal however remains in discussions with KKR regarding its proposal,” MYOB said in a statement.
MYOB said in October it would be “business as usual” while the takeover offer was being considered.
The news of a revised proposals hit its share price on Thursday, sending it down 14% to under $2.90.
KKR already owns about 20% of the company, after buying a 17.6% stake in October from Bain Capital for $327 million.
Founded in the 1990s, MYOB is one of the most prominent accounting software platforms in Australia, but competition in the field has been increasing in recent years with the likes of Xero and Quickbooks out to capture market share.
MYOB delivered $218.5 million in revenue for the first half of financial year 2018, and said in August it was on track to reach one million online subscribers by 2020.