Bravura Solutions stock fell to a record low on speculation private equity firm Ironbridge Capital may reduce or withdraw its takeover offer for the group.
Shares of the wealth management applications provider dropped over 13 per cent to an all-time low of 56 cents in trading yesterday, before recovering to 64.5 cents.
“The likelihood of Ironbridge asking for a lower price or withdrawing its offer is increasing,” Morningstar equities analyst James Cooper said.
“Investors will be concerned Bravura’s client base will be diminished and weakened due to the global financial turmoil.”
Cooper added the company was specifically under pressure due to its exposure to the finance sector, and its weaker 2008 earnings of $18.6 million.
Ironbridge had expected Bravura to post earnings of at least $23.5 million, when the private equity firm made a $272 million all-cash offer earlier this year, valuing Bravura at $1.73 a share.
A Bravura spokesperson said the company’s latest stance on the matter was in a statement lodged to the Australian Securities Exchange (ASX) on September 5.
“Discussions with Ironbridge in relation to its takeover proposal are continuing,” the statement said.
“No assurance can be given that these discussions will result in the previously announced offer, or any revised offer being submitted to Bravura shareholders for their consideration.
“It is expected that these discussions will be concluded in the near-term.”
