Confirmation that private equity firm Baring Private Equity Asia Fund VIII (BPEA) is eyeing a takeover of translation and localization juggernaut RWS sent the stock market into a tizzy Thursday.
While in the earliest stages of exploration and strictly informal at this point, BPEA nevertheless confirmed its interest in response to chatter from the press.
“Following the recent media speculation regarding RWS, Baring Private Equity Asia Fund VIII Limited (“BPEA”) confirms that it is in the preliminary stages of considering a possible offer for the entire issued and to be issued ordinary share capital of RWS by a newly incorporated company controlled by BPEA or its affiliates,” BPEA officials said in a statement.
BPEA added that it has made no formal approach to the RWS board as yet, a fact that RWS itself confirmed shortly thereafter.
“RWS notes the announcement made by Baring Private Equity Asia Fund VIII Limited (“BPEA”) on 21 April 2022 and confirms that RWS has not received any formal approach from BPEA in relation to a possible offer for the Company (“Possible Offer”),” the RWS statement reads. “Shareholders are advised to take no action in relation to the Possible Offer at this time. RWS will provide an update as and when required.”
It didn’t take long for the market to react to the news. RWS shares jumped 21% following the announcement.
The public won’t have long to wait before BPEA announces whether it will move on its initial investigations. In accordance with United Kingdom law, the private equity firm must announce by May 19 whether or not it intends to move forward with the transaction.
“This deadline can be extended with the consent of RWS and the [UK Takeover Panel],” BPEA stated.
A language-industry giant, RWS specializes in localization services and technologies across a variety of verticals, including life sciences, government, financial services, energy, and more. Established in 1982, RWS grew over the next several decades through a series of mergers and acquisitions, culminating in a buyout of SDL in November 2020 for $1.066 billion.
“The acquisition that RWS and SDL just announced first of all means a shift in leadership for the industry,” Sarah Hickey, chief researcher at Nimdzi Insights, told MultiLingual following the announcement. “While RWS and SDL already ranked among the top five companies by revenue in the language industry, until now nobody has posed a significant threat to the leading position of TransPerfect, who’ve held the number one spot on Nimdzi’s ranking of industry leaders for the past three years in a row.”