Magnet Forensics shareholder Nellore challenges value of takeover deal

By: The Canadian Press Posted: 11:23 AM CDT Friday, Mar. 24, 2023 Last Modified: 11:57 AM CDT Friday, Mar. 24, 2023

One of Magnet Forensics Inc.'s shareholders says it has filed a notice of dissent after investors voted in favour of Thoma Bravo's $1.8-billion takeover of the cybersecurity company.

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One of Magnet Forensics Inc.'s shareholders says it has filed a notice of dissent after investors voted in favour of Thoma Bravo's $1.8-billion takeover of the cybersecurity company.

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This article was published 24/03/2023 (1244 days ago), so information in it may no longer be current.

One of Magnet Forensics Inc.’s shareholders says it has filed a notice of dissent after investors voted in favour of Thoma Bravo’s $1.8-billion takeover of the cybersecurity company.

Nellore Capital Management LLC founder and portfolio manager Sakya Duvvuru says if he and Magnet cannot reach a deal on the company’s valuation, the matter will be decided through court proceedings.

Magnet says 99.01 per cent of shareholder votes cast yesterday supported U.S. private equity firm Thoma Bravo’s takeover of the Waterloo, Ont.-based company.

Magnet Forensics Inc. says 99.01 per cent of shareholder votes cast supported U.S. private equity firm Thoma Bravo's $1.8-billion takeover of the cybersecurity company. The Magnet Forensics Inc. logo is shown in a handout. THE CANADIAN PRESS/HO

Holders of multiple voting shares gave the deal 100 per cent approval, while those with subordinate voting shares were 68.17 per cent in favour.

When subordinate voting shareholders required under securities laws to be excluded from the count were omitted, the deal garnered 66.85 per cent support.

The takeover needed two-thirds of support from all investors and a majority of votes in favour from subordinate voting shareholders before it can seek approval from the Ontario Superior Court of Justice.

Nellore, which holds 11 per cent of Magnet’s subordinate shares, has argued shares are worth more than the $44.25 in cash most holders will receive. Rolling shareholders will receive $39 per share.