Qoria Ltd (ASX: QOR) shares are catching the eye on Monday with a very strong gain.
The ASX All Ords small-cap share is up 33% to a 52-week high of 42 cents.
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Why is this ASX All Ords small-cap share soaring?
Investors have been fighting to get hold of the cyber safety company's shares this morning after it received a takeover offer.
Qoria, previously known as Family Zone Cyber Safety, revealed that it has received an unsolicited, conditional and non-binding indicative proposal from K1 Investment Management to acquire 100% of the issued share capital of Qoria for $0.40 cash per share by way of scheme of arrangement.
According to the release, the indicative proposal is subject to a number of conditions. This includes satisfactory completion of due diligence and exclusivity over a 6-week time frame, a unanimous Qoria Board recommendation, a commitment from all Qoria directors to vote in favour of the proposed transaction, final approval from K1, and entry into a binding scheme implementation agreement subject to numerous conditions including FIRB approval.
K1 Investment Management has advised that it has entered into call option arrangements with two Qoria shareholders owning approximately 169 million Qoria shares. This equates to approximately 14.4% of the ASX All Ords small-cap's outstanding shares. These arrangements can be exercised in the event that a competing proposal is announced.
Offer rejected
The ASX All Ords small-cap revealed that its board has concluded that the indicative proposal "significantly undervalues Qoria and has unanimously rejected the Indicative Proposal as not being in the best interests of shareholders."
It believes the proposal does not reflect Qoria's position as the global leader in both enterprise and consumer markets in child safety and wellbeing.
It also feels it ignores Qoria's strong growth prospects in a highly supportive regulatory environment and is opportunistically timed. The latter relates to the company being at a cash profit inflection point and in the midst of its most productive annual sales quarter.
Overall, the ASX All Ord small-cap stock's board does not intend to engage with K1 Investment Management and advised shareholders that they do not need to take any action in relation to the indicative proposal.
The board also warned that there is no certainty that a further proposal will be received from K1 Investment Management or any other third party. As a result, it urged shareholders not to place undue reliance upon such a proposal emerging.
