Trafficmaster, the former dotcom darling vehicle tracking company, has been bought by a San Francisco-based private equity group for £73.2m.
Vector Capital has agreed to pay Trafficmaster shareholders 47p a share, a 40pc premium to the average price over the three months before the announcement of the first approach on April 27.
The shares have almost doubled since the start of the year, but are still far short of the £11 they hit at the height of the dotcom bubble. The company had a paper value of more than £1bn in the summer of 1999.
Tony Eales, chief executive of Trafficmaster, said: “This transaction will increase our financial and operational flexibility and will enable us to accelerate our development.”
“Having a significant, long-term investor of Vector Capital’s stature will allow us to further increase our capabilities and enhance the services we provide our customers. We believe this is a good deal for our shareholders, customers and employees and we look forward to working with the team at Vector to deliver our potential.”
Alan McWalter, Trafficmaster’s chairman who will collect £47,000 from the deal, said; “This transaction secures significant value now for Trafficmaster shareholders, and outweighs the alternative that could be derived should the company continue to remain publicly quoted and to pursue its own growth and acquisition strategy.”
David Fishman, a partner at Vector Capital, said: “We believe Trafficmaster and Teletrac [its US fleet tracking subsidiary] will significantly benefit from the company being a private company.”
Trafficmaster claims that it can cut its clients operating costs by up to 30pc and has won large fleet contracts, including Ryder, the logistics business, and the US Department of Homeland Security.