Craneware terminates £83m share sale within hours

Edinburgh-based healthcare software firm Craneware said on Wednesday morning it terminated a plan announced on Tuesday afternoon to raise £83 million to fund “a small number of acquisition opportunities” via a sale of new shares.

Craneware said its primary acquisition target had agreed acquisition terms overnight with a third party “meaning certain conditions set out in the placing agreement would not have been able to be satisfied.”

Craneware had said after the market had closed on Tuesday it planned to raise at least £80 million for acquisitions in a share placing.

The shares that would have been placed with investors would have represented 20% of the company’s current issued share capital.

However, on Wednesday morning, Craneware said: “Craneware plc announces that, despite the successful launch of the accelerated bookbuild and a strong oversubscription for approximately £83m from new and existing investors at a price per share of 1550p, the board has decided that it would be in the best interests of the company and its shareholders not to proceed with the placing and the placing agreement has been terminated.

“This decision has been taken following news in the US overnight that the company’s proposed primary acquisition target has agreed acquisition terms with a third party, meaning certain conditions set out in the placing agreement would not have been able to be satisfied.”

On Tuesday, Craneware had said the following: “Craneware … today announces a proposed placing to institutional investors of new ordinary shares of one pence each to raise approximately £80 million …” said Craneware.

” …the board has identified a small number of acquisition opportunities which it believes provide the company with compelling synergistic benefits through a combination of: extending the company’s customer coverage across US healthcare providers; adding proprietary technologies, expert knowledge and application extensions; and increasing the company’s scale …

” … these potential opportunities vary in size and complexity and the board does not expect to complete all of them. 

“The board believes that executing the placing would position the company to best be able to take advantage of the acquisition opportunities. 

“In particular, one of the possible acquisition targets is in a sale process and the placing is an important step to potentially gaining exclusivity and undertaking due diligence in that process …

” … Keith Neilson (CEO), Craig Preston (CFO) and Will Whitehorn (Chairman) all of whom are UK based directors of the company intend to participate in the placing, amounting to approximately $315,000 in aggregate.”