over 420p on 1st July. The share price flagged after that, dropping back below the 400p mark on 13th July as investors started to wonder whether a deal with FIS would go ahead. It stayed below 400p until 20th July, at which point reports started to circulate that Misys and FIS were close to a deal. This saw an eight per cent rise in the price, moving it back over the all-important 400p mark for another four days. In the 20 days from the announcement of the bid, the price averaged 409p.


It touched a closing price of 400p twice more, on 26th July and 28th July, but did not rise above 400p and so did not add to the 20 days it had notched up above the line. The price then started to fall away, at first gently, with Misys announcing its annual results, and then dramatically when it was confirmed that talks with FIS had concluded without agreement. At noon on 5th August, having lost another seven per cent of its value


A new owner Another commotion then ensued in early February 2012,


when Misys went public on plans to merge with Temenos. This sparked share volatility and much debate. The plan was to unite under a new holding company which would seek a premium listing on the London Stock Exchange (LSE) with a potential secondary listing on SIX Swiss Exchange. The combined group would have a head office in Switzerland, home of Temenos’ HQ. In terms of the share swap, the exchange ratio was 4.1 Misys shares to one Temenos share. If the consolidation had gone ahead, this would have meant Misys shareholders would have owned approximately 53.9 per cent of the issued share capital of the combined group and Temenos shareholders would have owned the rest. Misys’ largest single shareholder at the time, ValueAct, expressed ‘strong support’ for these plans. Matters then moved apace, with the announcement a couple of days later of the departure of Lawrie, who moved to CSC as CEO. Temenos’ relatively new CEO, Guy Dubois, was set to take the reins at the new entity but venture capitalists were now joining the ranks of interested buyers, including ValueAct, which partnered with CVC Capital Partners in early March to make a joint cash offer. This caused Temenos’ merger plans to fall through and, by mid-March, both companies had terminated talks on the planned all-share merger. US-based venture capital firm, Vista Equity Partners,


then entered the fray with another cash bid. Vista had actually been the first to go on the record about its interest in Misys. Misys viewed the offer and its terms as ‘fair and reasonable’, according to a statement and shareholders Schroder Investment Management and Threadneedle Asset Management supported the bid. There was no mention about approval of the offer by ValueAct, with Vista’s move leaving CVC and ValueAct with a decision to either increase their offer


272


or pull out of the race. By early April, CVC and ValueAct had confirmed that they did not intend to proceed with an offer for Misys. This left Vista in pole position. Soon afterwards, it was announced that Vista had received overwhelming approval from Misys shareholders to acquire the company, despite the price of 350 pence per share being lower than the 400 pence earlier offer from FIS. The Vista offer now valued the company at around £1.3 billion. According to a statement released by Misys, over 99 per cent of voters followed the recommendation made by its board of directors and cast their votes in favour of the proposed takeover. Vista felt ‘Misys has an attractive future’, said the vendor. ‘Vista’s acquisition of Misys is testament to the platform for growth that Misys has established in recent years and customers can have confidence in the future of Misys’ products and services,’ the statement said. The completion date was originally expected to be 10th May, but this was subsequently pushed back to early June due to a monopoly probe in Portugal taking longer than expected.


The new owner intended to unite the businesses of Misys and its other recent acquisition in the banking software space, trading and risk management software vendor, Turaz, formed from the business bought from Thomson Reuters. As mentioned earlier, Misys had seriously considered purchasing Thomson Reuters’ trading and risk business itself when it came up for sale in mid-2011 but it was ultimately outbid by Vista. The head office for the combined entity was to remain in London, with Turaz already based here as well. Unlike with the earlier proposed takeover by FIS or merger with Temenos, there appeared to be no complications on the banking system side on bringing together the two vendors, although there was direct overlap in the treasury and capital markets space and also in risk management with Misys’ newly-launched


Universal Banking Systems Market Report | www.ibsintelligence.com


on the day, Misys was trading at 270p, giving a cumulative drop from the high of 420p of 150p, or 35 per cent. On 2nd March 2007, the month Lawrie was given the share price incentive, Misys closed at 268p. Misys’ financial results for the six months ended 30th November 2011 disappointed the market, although Lawrie insisted the results were ‘solid’. Misys recorded a post-tax loss of £2.7 million. Its shares fell by eight per cent on the day of the announcement, compared to the previous trading day, and closed at 305.3p. Lawrie partly attributed the performance to ‘delays in decision-making and elongated sales process in many cases, specifically at Western European institutions’. This had triggered cost-cutting plans in the marketing and administration areas, and on an enterprise-wide scale, ‘we are going to take some very aggressive cost and expense actions’, he stated.


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