Saxo Bank, which in 2009 acquired about 30% of EuroInvestor, has now announced that it completed an acquisition of additional 41% of the leading European share and financial trading portal. This will trigger a full acquisition offer for the remaining shares of EuroInvestor for the price of 15 DKK each. Until the announcement EuroInvestor's shares were trading at 11.50 DKK which represents a 30% premium over market price.
Back in 2009 Saxo Bank acquired a third of EuroInvestor.com, which has developed into the leading share and investment portal in Scandinavia since 1997, announcing that:
Saxo Bank continues to expand and has acquired a third of EuroInvestor.com. The partnership between Saxo Bank and EuroInvestor.com will create synergies between EuroInvestor’s share and investment portal and Saxo Bank’s award-winning Trading Platform , SaxoTrader.
“We have followed EuroInvestor since Søren and Jens Alminde launched Denmark’s first stock market service back in 1997. EuroInvestor’s services match our clients’ service demand. In return, Saxo Bank’s experience in online investment can help EuroInvestor further develop their services. Therefore, Saxo Bank has acquired a third of EuroInvestor”, says Kim Fournais, co-founder and Managing Director of Saxo Bank.
Brothers Søren and Jens Alminde are the principal shareholders of EuroInvestor with a total holding of 52.5%. Therefore, Saxo Bank is not obliged to offer to buy shares from the other shareholders of EuroInvestor. Saxo Bank intends, however, to offer the minority shareholders, i.e. all shareholders apart from the Alminde brothers, to sell their shares to Saxo Bank at a price of DKK 7, the price Saxo Bank is paying for the third of the shares acquired today.
EuroInvestor has more than 500,000 visitors a month and over 4,500 plus members who use the portal to make better investments. Its major success in Denmark caused EuroInvestor to launch portals in other countries in February 2004. The proportion of users in these countries has been on the rise ever since.
At the time of the 2009 acquisition EuroInvestor's shares were sold at around 7 DKK, and this morning (pre-announcement) trading at around 11.5 DKK, so that's a %60+ capital gain for Saxo in just two years already.
Today's acquisition announcement is huge news for our small (for now) financial portals industry as this is probably the first publicly announced acquisition deal in the portals space. Although it's not strictly a Forex portal this still gives us some data to chew on when calculating comparables and values of forex websites. Who doesn't want to know how much their portal is worth?
Luckily for us EuroInvestor is a public company, and will remain so for the time being, therefore we can gather some interesting data.
Some facts:
- EuroInvestor repoted a pretax profit of 4.5 million DKK in 2009-2010 period, down from 11.2 million DKK back in 2007-2008 period.
- For the first quarter of EuroInvestor's financial year (1 July 2010 - 30 June 2011) it had 8.7 million DKK in revenue (~35-38 million DKK yearly) and expected an annual profit of 8.5 million DKK (~1.6 million USD)
- EuroInvestor has 18,316,956 shares, therefore this deal values it at 274,754,340 DKK which is 52.5 million USD.
- Back in 2009 EuroInvestor had about 500,000 visitors a month and over 1,500,000 today (thanks to Jens Alminde, EuroInvestor's CEO, for sharing this info).
- EuroInvestor has 25 employees.
This gives us an incredible x32 price-earnings multiple!!! A stunning deal for EuroInvestor's shareholders no doubt though I'm sure Saxo Bank know well what they are doing here. As I wrote above this is fantastic news for our industry allowing brokers and portals as well as investment funds better analyze the pricing of similar deals having this deal in front of their eyes. I know at least one person who's going to be extremely pleased to see this multiple ;)
