GBG stock price up on GTCR private equity bid but how much is the UK tech co worth?

GBG stock price up on GTCR private equity bid but how much is the UK tech co worth?

data verification on phone
Potential takeover of GBG – Photo – Getty Images

US based private equity firm GTCR is likely to take over UK based identity verification provider GB Group. This is the latest in a string of foreign companies investing in UK firms, taking advantage of a weak pound.

Shares of GB Group, which has been in business since 1989, surged more than 35% after the news broke. It rebranded itself in 2006 as a data verification company to launch an effort to expand globally. Since 2012 the company’s revenue has grown tenfold as data verification came to prominence.

In fact this take-over bid is just the latest in a string of similar news stories of UK companies being offered investment opportunities. Other cyber security companies in the UK such are Avast (AVST), Darktrace (DARK) and Micro Focus International (MCRO).

Avast (AVST) share price chart

 

 

What is your sentiment on GBP/USD?

Vote to see Traders sentiment!

GBG future potential

Since its inception in 1989, GB Group has been involved in many aspects of data services. It was initially involved in post data supply, providing information on contact numbers and addresses. The firm decided to rebrand itself in 2006 as a data verification provider.

The news of the potential take-over, announced on GTCR website, caused the GB Group share price to rally almost 35%.

In response to the jump in the share price, GB group said: “The board of GBG notes GTCR’s statement that there can be no certainty that any firm offer will be made for the company, nor as to the terms on which any firm offer might be made. Any proposals received will be evaluated by the board of GBG together with its advisers.”

Darktrace (DARK) Price Chart

Weakening pound

The British pound has, in recent days, fallen to its lowest value against the dollar (GBP/USD) since the 1980s. At such levels, UK firms are becoming more attractive as foreign backers and private equity firms can invest in them relatively cheaply.

GB Group is the latest in a line of UK firms receiving foreign investment offers. Following are some other examples:

  •  Avast (AVST): the cybersecurity company, will be leaving London Stock Exchange after being taken over by US based rival NortonLifeLock (NLOK)
  •  Darktrace (DARK): while the US private equity firm Thoma Bravo has announced it will not be making an offer, analysts believe the UK cyber defence company remains an attractive takeover target
  • Micro Focus (MCRO) recently accepted a $6bn acquisition by OpenText, a Canadian cloud-based company
  • France-based Schneider Electric (SUp) is considering a bid for Aveva, a software engineering provider

AJ Bell investment director, Russ Mould outlines the effects of a strong dollar on global markets “While UK-based investors will be well aware of how weak the pound is against the US dollar, languishing near $1.15 and its lows of early 1985, sterling is not the only currency whose decline against the greenback is gathering pace.

“The DXY index (DXY), which measures the value of the dollar against six major currencies, stands at its highest level since 2002. Investors need to keep a close eye on this, because periods of marked dollar strength in the past have seen chaos in emerging markets, but also weakness in developed market stocks and commodity prices for good measure.”

Read more

Darktrace logo on phone and PC screen. Photo: Shutterstock

A image of the OpenText sign outside its headquarters

Source link

Related post

Healthium Medtech amongst the first in Asia and first…

– Meets highest safety and quality standards as a medical devices manufacturer Amongst the first medtech companies in Asia to receive…
Montgomery County funds upgrades for Canajoharie park

Montgomery County funds upgrades for Canajoharie park

VILLAGE OF CANAJOHARIE — Upgrades including a new pavilion and playground are slated for Wintergreen Park in the village of Canajoharie…
The Fiji Times » Bitcoin scam

The Fiji Times » Bitcoin scam

The Fiji Financial Intelligence Unit (FIU) says there are currently no authorised virtual assets service providers in Fiji. It made this…

Leave a Reply

Your email address will not be published.