Norkom in talks that may lead to €100m takeover
Published 27/11/2010 | 05:00
THE Dublin-based financial-security software company Norkom has confirmed that it is in discussions with a number of parties that could lead to a €100m-plus offer for the firm.
It confirmed the talks in a statement to the stock exchange yesterday after the markets had closed. An offer, if made, would easily value the firm at well in excess of €100m.
Shares closed up over 14pc yesterday at €1.09, which gave Norkom a market valuation of more than €97m.
Shares in investment firm TVC, which has a 27pc stake in Norkom, fell 2pc to 50c.
Norkom chief executive Paul Kerley owns almost five million shares in the company, representing over 5.6pc of its issued share capital. He acquired 52,000 shares in the firm earlier this month at 95c each.
Shares in Norkom, which was founded in 1998, have fallen from more than €1.70 in May this year and from over €2 at the end of 2007.
Norkom's software is used by financial institutions to improve their compliance and strengthen defences against fraud.
Its clients include global financial institutions, such as HSBC, Standard Chartered and Banque Populaire. It employs more than 350 people.
At the end of September, Norkom had €37.3m in cash on its books. In the same month, it issued a profit warning.
Releasing first-half results earlier this month, the company said that revenue for the six months to the end of September had declined 8pc to €22.6m while pre-tax profits slumped from €3.2m to €252,000. Earnings per share plummeted to 1.6c from 4.22c.
Yesterday's statement said the board had to take account of "the strategic options available to the company at any given time, including a sale of the business to a third party".
However, it stressed there was no certainty that an offer would be made.