Detica has record gain after takeover news

by Editor 7/22/2008 4:07:00 PM
UK technology consultancy Detica had a record increase in London trading after getting a preliminary takeover approach from BAE Systems Plc, the biggest defence company in Europe.

Detica’s value increased 33 percent, giving the consultancy a market value of 465.2 million pounds. This is Detica's biggest gain since it first sold shares in April 2002.

“A take-out price of 413 pence could be achievable, maybe more if a competitive bidding situation arose,” said Dresdner Kleinwort analyst Graham Brown.

Detica did not identify the company that had approached it in the statement regarding the offer on July 18. It was the Financial Times that identified the defense giant as the bidder.

The Guildford-based consultancy provides fraud detection software to the Internal Revenue Service and software for counter terrorist operations to the British Ministry of Defence. Government contracts account for over a half of the company’s revenue. It is considered to be a leading independent IT services provider in UK government security, which is what makes it attractive to the defence sector. Its other clients include UBS AG and Barclays Plc.

BAE is interested in the information technology services Detica provides to the British government, and the offer it has made is still informal, so it remains to be seen whether or not it leads to a formal bid.  

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