I am not going to accept the proposal from Soprano for a number of reasons. Firstly, I think that it is a very opportunistic proposal given that tech shares are currently out of favour. Whispir has had challenges. However, I believe these are more than priced into the very low share price. Whispir traded at over $4.50 in July 2020 and the offer price, of 55 cents, is over 85% below that. I also believe that Whispir is trading at a fraction of the price of some international competitors. For example, NYSE listed Servicenow trades at an enterprise value to revenue ratio of over 12. By comparison the offer for Whispir only values the enterprise value to revenue ratio at approximately 1.5.
Secondly, I also want to wait to see the status of other offers. It's interesting to hear that their may be a third bidder in the wings. However, in the absence of that I want to wait and see if Pendula to withdraw their tentative offer at 60 cents before accepting the Soprano offer at 55 cents.
WSP Price at posting:
56.0¢ Sentiment: Hold Disclosure: Held
