Soprano Design hits the right note with $63m takeover bid for Whispir

Mobile messaging software business Soprano Design has already amassed a 15 per cent stake in Whispir. Picture: iStock

A deal between mobile messaging software business Soprano Design and Whispir has always made sense, but the former has finally got the numbers to work – which is why it has chosen to strike now.

Both companies offer services for companies to send text messages to large numbers of people. They are understood have held discussions about a merger or buyout in the past, say sources, but Soprano Design never bought the business because the target wanted too much.

Apparently, ARN Media, which sold its 25 per cent stake in Soprano Design to Australian private equity firm Potentia earlier this year for $66m, told its shareholders that it thought highly of Whispir’s software.

The high price offered for the loss-making target is why ARN Media opted to sell its interest in Soprano Design.

The investment was non-core. Its main activity is radio broadcasting, with stations including KIIS and The Edge.

Soprano’s takeover bid of 48c per share values Whispir at close to $63m. Soprano will outlay $20.6m of its own cash, with $29.95m in funding from Montorio Nominees. Potentia is providing $16m.

Already, Soprano has amassed a 15 per cent stake in Whispir, with Spheria Asset Management selling its 7.6 per cent interest in the AustralianSuper-backed company on Friday.

Effectively, the deal sees Soprano buy Whispir’s software.

Jarden is working for Soprano, while RBC is advising Whispir.

The offer is a 92 per cent premium to the issue price of 25c per share under Whispir’s recently completed $3.25m private placement, as announced to the ASX on October 23, and a 60 per cent premium to the closing price of Whispir shares on November 3 of 30c per share.

Some expect more buyouts in the technology space to come, with many private equity firms picking the bottom of the market after the sell-off this year.

Shares in Whispir closed 61.6 per cent higher at 48.5c.

During the pandemic, it traded over $4.

Yet by July this year, it had fallen to about 26c.