Tungsten surges as Pagero says it's mulling bid

Tungsten Corp shares surged on Thursday after Pagero Group said it was considering a 45p a share offer for the IT service management company, which has just agreed to be bought by US software group Kofax for 42p a share.

Pagero, a Swedish smart business network provider, noted that its offer is a 7.14% premium to the Kofax offer.

Tungsten said: "There can be no certainty that an offer from Pagero will be made nor as to the terms on which any offer might be made."

Earlier on Thursday, Tungsten said it had agreed to be bought by Kofax for £53.7m in cash. This is a 44.8% premium to the closing Tungsten share price on 13 December 2021, which was the last day before the start of the offer period.

Tungsten chairman Tony Bromovsky said: "Over recent years, the management of Tungsten has continued to develop its product offering and routes to market to position itself for profitable growth. Whilst profits have been firmly established, and the strategy is bearing fruit, stronger growth rates remain outstanding. We continue to focus on growth and importantly, to invest in innovative product development to ensure that Tungsten keeps pace with the wider market and its competitors, many of whom are materially larger and better capitalised.

"However, the successful execution of our strategy, and ultimately accelerated growth, requires continued investment in research and development and may require further capital. Against this backdrop, I believe the offer from Kofax represents a fair premium, it provides certain value today for Tungsten shareholders and it provides Tungsten with the opportunity to expand the scale of Tungsten's business by offering its products to a wider customer base, leveraging Kofax's geographical reach, capacity for investment and operational infrastructure."

At 0925 GMT, Tungsten shares were up 19% at 46.20p.