EU approves CSC's iSoft acquisition

By on
EU approves CSC's iSoft acquisition

iSoft directors seek shareholder approval for $460 million deal.

Industry giant CSC has passed its first regulatory hurdle towards acquiring Australian e-health supplier iSoft by receiving unconditional clearance from the European Union (EU) for the deal.

The companies agreed to a $460 million buy-out in April. CSC has been iSoft’s biggest customer since 2004, via a British Government deal.

The acquisition remains subject to approval by iSoft shareholders and Australian Courts.

According to documents lodged with the Australian Stock Exchange (ASX), iSoft shareholders and option holders would meet to discuss the proposal on 15 July.

The deal would then face the Federal Court on 18 July, and with these conditions met, all iSoft shares would be transferred to CSC Australia on 29 July.

iSoft directors urged shareholders to approve the deal in ASX documents published last week (pdf).

The proposed acquisition followed a strategic review of iSoft’s indebtedness, after the company reported a loss of $383 million in the 2009-10 financial year.

iSoft Chairman Bob Ellis wrote that CSC’s offer was “the only definitive proposal” that it had received, noting that no others were as attractive or certain from a funding, execution and timing perspective.

He said CSC’s offer of $0.17 a share and between $0.001 and $0.033 an option exceeded valuer Lonergan Edwards’ valuation of $0.108 to $0.141 a share and $0.000 to $0.021 an option.

CSC had also agreed to take over iSoft’s outstanding senior debt of $138.2 million, and $39.7 million in convertible notes, which would otherwise mature between December 2011 and November 2012.

“iSoft is currently operating with limited scope for additional funding under its financing agreements,” Ellis wrote.

The Australian company advised shareholders that the deal was worth approximately $460 million, including shares, options, convertible notes, warrants, debt and fees.

Last month, the NSW Supreme Court dismissed claims by iSoft founder and former chief executive Gary Cohen, who claimed to have pre-emptive rights over some shares.

Cohen reportedly indicated he might make a counter-offer for iSoft, and that other bidders were in the wings.

CSC stated today that once completed, the acquisition would strengthen its software and services portfolio and enhance its healthcare research and development capabilities.

Copyright © . All rights reserved.

Most Read Articles

Log In

|  Forgot your password?