A woman holds Euro banknotes in this illustration taken May 30, 2022. REUTERS/Dado Ruvic/Illustration
(Reuters) -Private equity firm Warburg Pincus struck a deal to buy Germany's PSI Software for more than 700 million euros ($811 million), with shareholder E.ON remaining a strategic investor, the companies said on Monday.
Reuters first reported on both a nearing takeover of PSI on Friday and Warburg Pincus' offer for the maker of software for energy networks on Sunday.
Having jumped nearly 11% on Friday after the news broke, PSI shares had gained a further 35% at 0733 GMT, reaching 44.7 euros - their highest since January 2022.
That was close to the offered price of 45 euros apiece in Warburg Pincus' deal, amounting to a premium of about 50% from the company's closing price on Thursday.
MANAGEMENT STRUCTURE TO BE MAINTAINED
PSI's software helps run power and gas transmission grids as well as factories and Reuters has reported that it was seeking funding for the development of product upgrades.
It is recovering from a cyberattack last year and on Friday it confirmed that it was in talks to sell itself, following the Reuters report.
PSI said its board supports the suitor's offer and intends to recommend it to its shareholders. PSI plans to delist from the German stock exchange after the closing of the deal.
PSI added that Warburg Pincus would maintain the company's management structure and its headquarters in Berlin.
Warburg Pincus has signed agreements for about 28.5% of PSI's equity with its anchor shareholders, PSI said. The statement said that an unnamed anchor shareholder will partially reinvest its proceeds alongside Warburg Pincus into PSI's holding structure.
German businessman and newsletter publisher Norman Rentrop is PSI's largest shareholder with a 23% stake, while German utility E.ON is its second-largest investor with around 18%.
E.ON will retain its stake in PSI as a strategic investor, Warburg and PSI said. For the purpose of the transaction, the power utility will be regarded as acting jointly with Warburg Pincus, according to the statement.
Last year, PSI posted a loss before interest and taxes of 15.2 million euros ($17.6 million) as it was hobbled for weeks by the cyberattack.
Goldman Sachs is running the sale process.
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(Reporting by Rishabh Jaiswal, Shubham Kalia and Disha Mishra in Bengaluru and Alexander Huebner in Munich, Christoph Steitz and Ludwig Burger in Frankfurt ; Editing by Sherry Jacob-Phillips, Thomas Derpinghaus, Aidan Lewis)
