Tech firm Checkit has abandoned its effort to acquire smaller AIM-listed rival Crimson Tide, which is still considering a £20.5m proposal from Ideagen.
Checkit announced on Wednesday that it did not intend to make a firm offer for Crimson Tide after the company rejected a raised takeover proposal earlier this month.
Cambridge-based Checkit’s first formal all-share proposal valued Crimson at 182p per share, while its revised bid considered offering up to nine of its shares for every one Crimson share.
Crimson said the second proposal did not address its concerns over the first, including financial terms, governance and management, while also noting that neither contained a proposed cash alternative.
On the same day Checkit made its second approach (14 June), regulatory and compliance software company Ideagen made a 312p per share proposal – representing a roughly 76 per cent premium to Crimson Tide’s closing price before the offer period.
Crimson is still considering Ideagen’s proposal. Under UK takeover rules, the company has until 5 p.m. on 19 July to either make a firm offer or walk away. Checkit’s deadline was 2 July.
Checkit is now unable to submit another takeover proposal for six months. It had previously attempted to engage in discussions with Crimson multiple times over the last four years.
The firm provides customers with a workflow management software platform that delivers remote monitoring and automated surveillance to manage their teams of so-called deskless workers.
Checkit said in February that its path to profitability was moving faster than expected after it halved its annual loss to £3.4m in 2023.
Kit Kyte, Checkit’s chief executive, has previously said a merger with Crimson would “position the enlarged entity as a market leader in workflow software solutions, leveraging the strengths of both organisations for enhanced profitability and competitive advantage whilst being more attractive to existing and potential new investors”.
Crimson, founded in 1996, owns mpro5, a field service management software platform used in sectors including facilities management, retail, rail and hospitality.