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AIA

Bain trumps Sage with A$1.2bn bid

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22nd Aug 2011
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Sage has missed out on the chance to acquire Australian software house MYOB after US private equity firm Bain Capital swooped in with a A$1.2bn (£760m) bid, according to Reuters.

As reported last week, Sage had confirmed it was in exclusive talks to buy MYOB after outbidding its rivals with an offer of A$1.4bn (£887m).

However, a drop in its share price due to market turmoil and the consequent need for shareholder approval undermined its ability to follow through with the bid.

[Sage Group's share price on 18 August 2011]

Despite criticism about the potential deal from rival Cloud accounting developers such as Xero and KashFlow, analysts could see the geographical logic for the move.

Bain and Kohlberg Kravis Roberts & Co re-entered the race for MYOB after the UK software group's attempt was derailed.

MYOB, or Mind Your Own Business, is being sold by Archer Capital and HarbourVest Partners, which bought it for A$450m (£284m) in 2008.

The Bain deal values MYOB at about 11.3 times earnings before interest, tax, depreciation and amortisation - 10% below the failed Sage bid.

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