Edinburgh-based accounting software firm FreeAgent, which is being acquired by Royal Bank of Scotland for about £53 million, on Thursday reported strong progress in a trading update for the year ended March 31, 2018.

“For the full year ended 31 March 2018, the board expects to report revenue of £9.8 million and annualised committed monthly recurring revenue (ACMRR) of £10.1 million in line with our expectations,” said FreeAgent.

“Period end net cash was approximately £2.3 million.”

FreeAgent CEO Ed Molyneux said: “Overall progress has been strong, particularly in our banking channel, despite headwinds in the practice channel – courtesy of the turmoil surrounding the IR35 changes.

“The RBS partnership has continued to prosper and we were pleased on 27 March to announce the terms of a recommended cash offer for FreeAgent by a wholly-owned indirect subsidiary of RBS at a price of 120 pence per share.

“Formal offer documentation is expected to be despatched to FreeAgent shareholders shortly and in any event on or before 24 April.”   

The RBS offer price of 120p in cash represented a premium of 86% to FreeAgent’s closing price of 64.5p the day before the deal announcement and a premium of 42.9% to the firm’s IPO price of 84p.