Ailing Acorn agrees to pounds 270m US takeover
Wednesday 28 April 1999
The deal releases the value of Acorn's 24 per cent stake in ARM Holdings, the highly successful microchip maker whose shares have soared since coming to the market a year ago.
Investors had been pushing for a deal as Acorn's stock market value had been less than the value of its stake in ARM, which it spun off into a separate entity in 1990.
Under the terms of the deal, Acorn shareholders will receive two shares in ARM for every five Acorn shares held. The deal values Acorn shares at 279p, a 14 per cent premium to their previous closing price.
The takeover has already secured the agreement of shareholders accounting for more than 50 per cent of the equity. These include Dr Hermann Hauser, one of the founders of the original Acorn computer company. His stake in ARM will be worth around pounds 7.5m
In two separate deals, Acorn is also selling its fledgling digital television set-top box business to Pace Micro Technology for pounds 200,000. It is also in talks to sell its software development business to Stan Boland, Acorn's chief executive. Acorn said it would have been unable to fund the development required to move the two businesses forward.
Acorn said it believed the Morgan Stanley deal was the "best available solution" for shareholders. The company has been struggling badly and last year recorded an operating loss of pounds 10m on sales of pounds 11m. Its only profits came from the sale of shares in ARM and its share of ARM's profits.
"I am delighted we have been able to generate a value- enhancing solution that enables Acorn shareholders to participate directly in ARM's extraordinary success," said Gordon Owen, the Acorn chairman.
Acorn shares closed 9.5p higher at 254.5p, compared to their low point of just 57p in November. ARM closed 22.5p higher at 695.5p.
- 1 Qataris pledge to expand Canary Wharf
- 2 #JeSuisEd: People share photos of themselves eating awkwardly in solidarity with Labour leader
- 3 Women think Irish men are the sexiest, survey finds
- 4 Florida couple forced to register as sex offenders for having sex on public beach
- 5 Watch eerie drone footage of destroyed building in Stalingrad
#JeSuisEd: People share photos of themselves eating awkwardly in solidarity with Labour leader
Florida couple forced to register as sex offenders for having sex on public beach
UK election candidates: 'Nasty party' Ukip faces fresh questions on eve of vote
Who should I vote for in the general election? Take The Independent's interactive quiz to find out which party's the right choice for you
Ohio 'Shawshank Redemption' fugitive Frank Freshwater arrested after 56 years on the run
In defence of liberal democracy
General Election 2015: Post-election 'shambles' looms as 70 per cent of voters say SNP 'should not be able to veto UK government policies'
The Rothschild Libel: Why has it taken 200 years for an anti-Semitic slur that emerged from the Battle of Waterloo to be dismissed?
General Election 2015: UK will be 'run for the wealthy and powerful' if Tories retain power, Labour warns
General election live: SNP suspends two members for disrupting Labour rally
General election live: Booths open at 7am across the country on polling day
iJobs Money & Business
£60000 - £70000 per annum + benefits : Ashdown Group: A highly successful, glo...
£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...
£27 - 35k + Bonus + Benefits: Guru Careers: A Management Accountant is needed ...
£40-50k + Benefits.: Guru Careers: A Project Manager / Business Analyst is nee...