Technology group falls to rival takeover so it can pay its staff

THE TIMES Business
Technology group falls to rival takeover so it can pay its staff
Nic Fildes

The company at the heart of a share sale row has succumbed to
a takeover from its rival Myriad.
The deal values Synchronica at 15p a share or £23.85 million, above Myriad's previous offer in January of £20 million. Myriad has also agreed to lend Synchronica $3 million (£ L9 million) so that it can pay staff over the next two months. Synchronica appears to have agreed after running low on funds because a Canadian technology supplier withheld the payment of a substantial loan.
The company has warned that even the Myriad loan may not be enough for it to meet working capital requirements during the formal bid process.
The takeover marks the end of an eventful few months. Angus Dent, chief executive, spent £49,000 on 800,000 shares in the business only three weeks after Myriad approached the company with what was described as a "vague" takeover offer, which it rebuffed. Mr Dent acquired the shares with the blessing of its chairman and financial adviser.
Myriad had raised questioned about the version of events presented by Synchronica.
The shares Mr Dent bought in November have a value of £120,000 although it is understood that he has booked a loss on his initial investments in Synchronica. The shares traded at 780p in 2005 but had dwindled
to an all-time low during the period when he acquired his stake.
The new Myriad offer is pitched at a 93 per cent premium to the 7%p share price the day before the bid was finally revealed.
Myriad, which is based in Didsbury, Manchester, but listed in Switzerland, has offered 4.83 new shares for every 100 Synchronica shares.
The funding squeeze at the company was the result of a move to take over Nokia's mobile messaging business. The deal was hailed as a coup at the time but the company struggled to meet payments and has been hampered in its attempts to raise funds after revealing that it would have to pass on more capital to Nokia as part of a deferred consideration for the deal.
David Mason, the executive chairman of Synchronica, who personally approved Mr Dents share purchase, said: "Synchronica has expanded rapidly and working capital has been a constant challenge. The Synchronica board wishes to thank its shareholders for their steadfast support and hopes that the combined business will deliver the value that they deserve."