A takeover bid for Epicor Software took a dramatic turn this week after the software provider’s board declined a $9.50 per-share proposal and its suitor moved to force Epicor’s hand.
Elliott Associates, LP, the private hedge fund behind the proposal, announced on Wednesday that it would take its offer directly to Epicor stockholders and would seek to install Elliott’s representatives on Epicor’s board in an effort to compel the merger. Epicor responded by advising its shareholders to forgo any action until Epicor’s board can make a recommendation.
Elliott has valued the buyout at approximately $528 million, exclusive of the 10.2% of Epicor’s shares Elliott already owns. Elliott made the bulk of that buy-in on Sept. 24, snapping up more than 1,000,000 shares.
According to SEC filings, Elliott had approached the ERP provider in August to begin negotiations for a sale. Elliott’s Oct. 15 SEC filing states, “On September 29, 2008, [Epicor’s chairman George] Klaus called [Elliott Portfolio Manager Jesse] Cohn and stated that [Epicor’s] Company Board believed that a meeting with Elliott Associates was premature because the Company was releasing new software, an industry conference was coming up, and the Company was going to release its earnings for the quarter soon.”