Riverdeep MBO concludes

7 Apr 2003

The management buyout (MBO) team at Irish e-learning company Riverdeep has announced that the MBO has been accepted by shareholders, closing the deal after months of offers and counteroffers.

The vehicle established to carry out the MBO – Hertal Acquisitions, which is led by Riverdeep chief executive, Barry O’Callaghan – said that since the deadline of Friday 4 April it had received 94pc of shares required for the buyout.

In a statement O’Callaghan said: “Hertal can now concentrate its efforts in full co-operation with the management and staff of Riverdeep on further developing the company’s product range and market penetration.”

The buyout has an estimated value of US$376m (€353.1m – €1.51 per share).

The offer represented a premium of around 31pc more than the average closing share price of Riverdeep in the month before the announcement of the initial approach in November. Shares at that time leaped by 122pc following news of the MBO.

In February, Riverdeep reported a second quarter pre-tax loss of US$3.15m, comparing harshly with a profit of US$5.68m for the same period the previous year.

For the first half to end of December 2002, the company made a pre-tax loss of US$2.04m against a profit of US$5.99m, on sales of US$117.83m against sales a year earlier of US$70.8m.

Riverdeep will cease to be listed on the ISEQ from 7 May and will also be delisting from the fledgling tech exchange ITEQ.

By Suzanne Byrne