6 Dec 2012

Major investors back Endace takeover offer

6:42 pm on 6 December 2012

US-listed Emulex has made a $US130 million takeover offer for New Zealand-based network equipment maker Endace.

The offer by the US storage equipment maker is a 65% premium to Endace's closing price on London's AIM market on Tuesday, and its key investors are backing the deal.

Endace provides network security equipment to government security agencies, global telecommunication firms, some of the world's largest ISPs and a number of major corporations.

Emulex is offering £5 a share compared with just over £3 when the stock closed on Tuesday, valuing Endace at $US130 million.

It has already secured the stakes of some Endace directors including co-founder Ian Graham, and has received expressions of support from co-founder Selwyn Pellett and commitment letters from two other Endace directors who are shareholders.

Endace's independent directors are backing the deal subject to the offer being within or above the valuation range in Grant Samuel's appraisal report of the bid.

A deal is expected to be completed in the first three months of next year.