Checkit proposes merger with rival Crimson Tide
Summary
Software business Checkit announced plans to merge with rival Crimson Tide on Tuesday, stating the acquisition would help both companies create "a scaled workflow software company". As per Checkits £12.0m offer, Crimson Tide shares will be valued at 182.0p each, representing a 12% premium to its middle market closing price on 3 June. The AIM-listed group stated it had identified "significant potential revenue and cost synergies" stemming from the proposed merger with Crimson Tide, which could result in the enlarged company attracting a wider pool of investors and consequently being attributed higher valuation multiples by the market. Checkit also believes enhanced product offerings may present multiple opportunities for cross-selling and upselling. "We believe it will position the enlarged entity as a market leader in workflow software solutions, leveraging the strengths of both organisations for enhanced profitability."