Credit information provider Veda Group has backed a US takeover after the price tag was bumped up to $2.
The data analytics firm has information on 20 million individuals and more than five million businesses in Australia and New Zealand, which is used by customers to assess credit risk, carry out background checks and reduce fraud and identity theft.
US rival Equifax has boosted its all-cash offer for Veda Group to $2.825 per share, up from the $2.70 offered in mid-September.
Veda’s board has agreed to allow Equifax to carry out due diligence, and said it will unanimously recommend the proposal if it proceeds to a binding offer.
“The board of directors considers the revised proposal reflects Veda’s outstanding market position and represents a strong financial outcome for our shareholders,” chairman Helen Nugent said.
Equifax is based in Atlanta and holds data on more than 600 million consumers and 81 million businesses around the world.
It has cautioned that a deal remains subject to further negotiation and approval from regulators and its own board.
If it gets the green light, the takeover will mark a rapid rise for Veda, which rejoined the share market less than two years ago with a value of just over $1 billion.
Shares in Veda rose four cents to $2.69.
OptionsXpress market analyst Ben Le Brun said investors were pleased with the offer, but also wary given a deal needs approval from the Australian Competition and Consumer Commission and Foreign Investment Review Board.
“It’s an all cash deal which really stands out in this market compared to a cash and scrip deal or a scrip deal,” he said.
“It is trading at bit of a discount to the $2.825 bid on the table, which reflects a tiny bit of regulatory uncertainty that the deal will be approved.”