In just the past few days, software company Portrait Software has accepted a takeover offer from Pitney Bowes (NYSE:PBI) valuing the company at £44 million. This morning it was the turn of Intelek (LON: ITK) to receive a knock out bid from a US competitor. Teledyne Technologies (NYSE:TDY) confirmed that it had offered 32 pence per share for Intelek, or approximately £28 million, in cash, for the AIM listed manufacturer of electronic systems for satellites. Teledyne Technologies also manufacturers a range of electronic components and subsystems, instruments and communication products, but currently has a limited presence in military satellites, where Intelek is a specifically focused.
Share in Intelek jumped 100% on the confirmation of the bid, not surprising considering the offer from NYSE listed Teledyne Technologies was a 105% premium to Intelek’s closing price yesterday. Teledyne has already secured either irrevocable undertakings or ‘best endeavours’ from shareholders representing around 35% of the company’s equity to vote in favour of the offer.
"The directors of Intelek have focused our strategy on further developing our satellite and microwave communications business as a core value driver for the Intelek Group. This Offer for Intelek is at a substantial premium and we unanimously recommend that shareholders accept this Offer,” Ian Brodie, Chief Executive Officer of Intelek, said.
For the year ended 31 March 2010, Intelek generated revenues of £37.7 million, underlying profit before tax of £3.9 million and cut its debt pile by more than half to £1.6 million. Probably of most significance to Teledyne Technologies, Intelek’s sales in North America increased by 75% to £12.5 million - largely for government and military programmes.
Disclosure: The author holds no positions in the company