Software giant Microsoft Corp. on Tuesday, January 8, unveiled a 6.6 billion Norwegian kroner ($1.2 billion) offer for Oslo's Fast Search & Transfer ASA to add the target's research and reporting software to its corporate Office products.
Redmond, Wash.-based Microsoft said it would pay Nkr19 per Fast Search share, a 42% bonus to the closing price Friday, before shares were suspended pending the Microsoft announcement. Investors representing 37% of Fast Search's stock have accepted the offer, including the target's two largest shareholders - conglomerate Orkla ASA and financial investor Hermes Focus Asset Management Europe Ltd. Microsoft already owns 5% of Fast Search.
"Enterprise search is becoming an indispensable tool to businesses of all sizes, helping people find, use and share critical business information quickly," said Jeff Raikes, president of Microsoft's business division, in a statement.
The announcement sparked a 42% gain in Fast Search's shares Tuesday but the stock had already surged at the end of December when Orkla, which holds 14% of Fast Search, demanded an extraordinary shareholder meeting to oust Fast Search chairman Thomas Fussel and board member Robert Keith. The move came after the company in December said it may have to restate its 2006 earnings while announcing write-downs on assets and accounts receivables.
Fast Search's board is recommending shareholders accept the offer, which is expected to close in the second quarter.
Fast Search's shares were up Nkr5.55 by mid-day in Oslo trade at Nkr18.90, just under the Microsoft offer.
Fast Search expects 2007 revenue of between $200 million and $210 million with positive Ebit. For 2006 it reported sales of $162.6 million and Ebit of $2.5 million. The company has already begun laying off workers to cut costs and focus on its core activities, which sparked the write-offs.
Goldman, Sachs & Co. is acting as Microsoft's financial adviser, while Merrill Lynch is handling financial details for Fast Search.
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