TSX-listed Constellation Software Inc is making a mandatory offer of 33p a share for Gladstone following its failure to secure control of the software company via its 25p a share bid at the end of 2008.

Constellation offered 25p a share for the health club membership software developer at the end of 2008 but failed to pass the 50% mark and the bid was unsuccessful.

Constellation retained 29.9% of Gladstone and the purchase of a further 13.64% of Gladstone for £2.17m has taken the stake to 43.48%. Constellation has to bid the same price for the remaining shares it does not own.

The sterling exchange rate with the dollar has fallen since Constellation bought its initial stake roughly two years ago and reports its figures in US dollars. It paid around 25p a share at that time and 33p a share is a similar price in US cents to two years ago following the fall in the pound.

That makes the higher bid price look less generous than it might appear at first. In the past two years Gladstone has increased its cash pile and invested in upgrading its software.

The bid values Gladstone at £18.1m.

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