Management consultancy and software provider Avisen has made a recommended bid for location-based software specialist 1Spatial.

1Spatial shareholders are being offered 5.761 new Avisen shares for each 1Spatial share they hold in an offer that values 1Spatial at about £4.74m, and each 1Spatial share at 22.35p, based on the closing share price of Avisen on the day before the bid was announced.

Seeing as 1Spatial shares were trading at 25p the day before the bid announcement, the immediate market response was to mark 1Spatial's shares down a halfpenny to 24.5p.

However, the share price of Avisen rose by one-eighth of a penny on the bid announcement to 4.00p, boosting the value of its bid to 23.044p per 1Spatial share.

Irrespective of the fluctuations of the respective share prices, the merger looks almost certain to go ahead as irrevocable undertakings to accept the Avisen terms have been received in respect of around 77% of the issued share capital of 1Spatial.

The enlarged group will be led by a management team drawn from the boards of both 1Spatial and Avisen. 1Spatial chairman Steve Berry will be Non-Executive Chairman, Avisen Chief Executive Officer Marcus Hanke wil lhold the same position at the enlarged group while 1Spatial's Chief Executive Officer will be Managing Director of the merged group.

In a separate announcement 1Spatial released its full year results to the end of June showing a pre-tax loss of £2.09m, versus a profit of £0.38m the year before.

Revenue fell to £7.3m from £8.0m a year earlier, as delays in public spending during the government's first year in office, new procurement processes and the need for increased justification for spending led to a slow-down in the placing of orders.


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BS/JH

Related share prices
Avisen (AVI) share price
1Spatial (SPA) share price