(Reuters) -Hargreaves Lansdown is set to agree a 5.41 billion pounds ($6.87 billion) takeover by a CVC-led consortium if the group of investors table a formal offer at that price, the British company said on Tuesday.
The London-listed investment platform has agreed to extend the deadline for the consortium to make a firm offer by a month, saying it will engage with the group and provide confirmatory due diligence access.
The revised proposal is at a price of 1,140 pence per Hargreaves Lansdown share in cash, including a 30 pence final dividend for fiscal 2024.
The British investment platform had previously rejected a 4.67 billion pounds, or 985 pence a share, buyout proposal by the consortium in May, saying it “substantially” undervalued its prospects.
“The Board has confirmed to the Consortium that the revised possible cash offer is at a value that the Board would be willing to recommend unanimously to Hargreaves Lansdown shareholders,” it said in a statement,
The consortium has until July 19 to make a firm offer for Hargreaves or walk away.
Hargreaves shares, whose value have more than halved from their all-time high in May 2019, were up 4.5% at 1,122 pence by 1435 GMT.
Reuters exclusively reported in May that Peter Hargreaves, the biggest shareholder in Hargreaves Lansdown, was open to taking the company private at a higher price.
Hargreaves Lansdown is the latest London-listed company to become a takeover target as analysts note an uptick in M&A activity in the UK.
Founded in 1981 by Peter Hargreaves and Stephen Lansdown and listed in London in 2007, Hargreaves Lansdown primarily caters to the UK market but offers US, Canadian, and European shares in its investment options. The investment platform has seen tough competition from online start-ups, with U.S. trading platform Robinhood the latest to launch in Britain. Despite headwinds, Hargreaves Lansdown reported a strong first quarter in April, adding 34,000 new customers and 1.6 billion pounds of net new business as stock markets staged a recovery.
($1 = 0.7892 pounds)
(Reporting by DhanushVignesh Babu and Yamini Kalia in Bengaluru; Editing by Mrigank Dhaniwala, Devika Syamnath and Christina Fincher)
