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18 Dec 2014

Stephenson Harwood advises incadea on Dealertrack’s £122 million takeover bid

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International law firm Stephenson Harwood LLP is advising incadea plc (incadea), a leading provider of enterprise software and services to the global automotive dealership industry, on its potential sale for £122 million in cash to NASDAQ listed Dealertrack Technologies, Inc (Dealertrack). Dealertrack is a web-based software solutions and services provider to all major segments of the automotive retail industry. The agreement on the terms of the recommended cash offer for incadea was announced yesterday, Thursday 18 December 2014.

The offer is priced at 190 pence for each incadea share, representing a near 60 per cent premium to incadea's share price prior to the discussions being announced. The consideration for the offer represents, on a fully diluted basis, an equity value of approximately £122 million in aggregate.

Dealertrack has a strong track record of acquiring and integrating companies, and it believes incadea represents an excellent opportunity for it to create a global footprint with a strong base of installed international customers in Europe, Asia and Latin America as the companies' geographic fit and product offering are highly complementary. From incadea's perspective, its growth opportunities are increasing in scope and value. For example in January 2014, Stephenson Harwood advised incadea on its acquisition of RC Real Business Solutions GmbH for €12.5 million in cash together with an associated £11.5 million placing by incadea's nominated adviser and joint broker, Cenkos Securities plc. However, given the balance of future opportunities and risks facing the business, incadea could potentially benefit from the additional financing as well as operational support which Dealertrack is able to provide in order to take best advantage of the opportunities available to it.

Commenting on the transaction, Duncan Stiles, Head of Corporate Finance at Stephenson Harwood, said: "We are delighted to be advising incadea on the Dealertrack offer having working closely with incadea's management following its IPO in May 2012, including on the key RCRBS acquisition. As the offer announcement noted, Dealertrack has been greatly impressed with the capabilities, skills and experience of incadea's executive management, a team that we really enjoy working with. We are excited to be involved in this latest stage in incadea's development as it represents a further example of the key, strategically important deals, on which the SH corporate finance team advises its clients."

The Stephenson Harwood team was led by corporate partner Duncan Stiles. He was assisted by senior associate Guy Morgan and corporate associates Brendan Sheehan and Matt Peters. Employee incentives partner, Barbara Allen, is advising on share scheme arrangements.

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Duncan Stiles

Duncan Stiles
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