Aveva Group, the FTSE 100-listed software firm, said it intends to raise £2.84billion through a rights issue to part-fund the acquisition of SoftBank-backed rival OSIsoft.
Under the terms of the rights issue, investors can buy seven new Aveva shares for every nine shares they own at £22.55 each, a discount of 32.2 per cent on the theoretical price the shares will be following the transaction.
Aveva said it will offer 125.7million new shares in the rights issue. The stock fell 2.1 per cent to 4,118p in early trade on Friday.
Aveva is a relatively rare example of a British firm buying out a foreign rival, rather than being snapped up itself.
Aveva’s $5billion purchase of OSIsoft will expand its offering by adding the California-based firm’s PI system, which makes software that captures data from ships, chemical boilers, power plants and other facilities in industries including oil and gas, mining, pulp and paper and water.
France’s Schneider Electric, which indirectly holds a 60 per cent stake in the company, has confirmed it will take up its rights in full on a pro rata basis, Aveva said.
Aveva is also funding the takeover with cash on its balance sheet, new debt and by issuing shares to one of OSIsoft’s shareholders, Estudillo.