An investor consortium led by pan-European private equity group Bridgepoint Advisers Ltd. offered to buy all series A and series B shares that the group does not already own in Swedish gaming company Cherry AB (publ) at 87 Swedish kronor per share in cash.
The total value of the offer, based on all series A and B shares in Cherry, corresponds to about 9.19 billion kronor.
The acquisition will be made through European Entertainment Intressenter BidCo AB, a newly formed company jointly owned by the investor group that includes Bridgepoint's Bridgepoint Europe VI LP; Prunus Avium Ltd.; Klein Group AS, which is owned by Cherry chairman Morten Klein; Audere Est Facere AS; Pontus Lindwall; Berkay Reyhan; and Can Yilanlioglu. The consortium already owns about 47.4% of Cherry's shares.
The offer price reflects a 20% premium to the closing price of Cherry's series B shares on Dec. 17, the last trading day before the offer was announced. Shares owned or controlled by the consortium will be transferred to European Entertainment in exchange for newly issued shares in the new entity.
Cherry, along with its series B shares, is listed on Nasdaq Stockholm, while its series A shares are not. European Entertainment plans to delist Cherry's series B shares from that exchange.
The closing of the deal is contingent on the offer being accepted to such extent that European Entertainment holds more than 90% of the aggregate shares in Cherry and the absence of a more favorable offer from other parties, among other conditions.
Cherry said the offer was reviewed by its independent bid committee and is recommending that shareholders accept the bid. Certain Cherry shareholders, including the founding families, who own about 11.6% of the company's shares have irrevocably accepted the offer, subject to certain conditions. The minority owners of Cherry's subsidiary Yggdrasil AB unilaterally waived certain minority rights under an agreement. The acceptance period for the offer is set to run from Dec. 20 through Jan. 23, 2019, unless extended.
The transaction will be financed with equity provided by the consortium and debt financing from Ares Management.
ABG Sundal Collier AB and Lazard Ltd. are financial advisers to European Entertainment, while White & Case is its legal adviser. Carnegie Investment Bank AB (publ) is financial adviser to Cherry, and Advokatfirman Delphi is its legal adviser.
As of Dec. 17, US$1 was equivalent to about 9.04 Swedish kronor.