Playtech founder ups takeover offer for Kape Technologies

An investment vehicle run by Playtech founder and Israeli billionaire Teddy Sagi has tabled a higher bid to fully acquire software provider Kape Technologies.

Unikmind is now offering the company’s investors a $3.44 (£2.85) per share for total control of the business, having had a 265p per share proposal rejected two months ago.

The latest offer represents a premium of about 25 per cent on Kape’s share price the day before the first takeover approach was made in early December and values the AIM-listed firm at $1.51billion (£1.25billion). 

Based in North London and formerly known as Crossrider, Kape originally began life as an advertising technology startup before shifting its focus to cybersecurity, buying up firms like Cyberghost and ExpressVPN in the process.

Sagi’s Unikmind, which already owns a 54.8 per cent stake in the group, helped underwrite the equity placing that was used to partly fund the acquisition of the latter company, one of seven takeovers it has made in the past five years.

It claimed that taking Kape fully private was the most suitable way forward for the business, given the current economic climate and uncertainties in capital markets. 

It also said the deal would enhance the investment needed to finance growth and help it avoid many of the costs associated with being a publicly-traded firm. 

Sagi said: ‘Having weighed the pros and cons of a public listing under the current macro uncertainties and thin stock market trading as well as new growth avenues, we are firm in our view that Kape’s next chapter in its corporate journey should be within the private arena. 

‘We are committed to Kape’s further growth within our group of companies, enabling it to exploit operational synergies and to access capital for its continuous growth, especially as the convergence of technologies is gaining momentum.’

Kape Technologies shares had climbed by 12.2 per cent to 292p on late Monday afternoon following the announcement of the offer, making it one of the ten biggest risers on the junior AIM market. 

In a statement, Kape said it had not decided whether to recommend the offer and would inform investors ‘in due course’.

Should shareholders approve the proposal, it would represent the latest in a long list of British technology giants to be swallowed up by foreign buyers taking advantage of a weaker pound sterling.

Just last month, engineering software developer Aveva was bought for £10billion by French conglomerate Schneider Electric, and IT company Micro Focus was snapped up by Ontario-based OpenText.

Aveva’s takeover was controversial due to Schneider’s close links with business and political elites in China, where it has a joint venture with electrical products maker Delixi Electric, and concerns among investors that the offer price was too low.