A trading halt for Appen’s stock was granted at 2.15pm,with the shares up more than 29 per cent at $8.27 - compared to their previous close at $6.40 - as analysts were weighing up the tentative offer,which was significantly less than what the Telus recently paid for rival AI services provider Lionbridge.
“This is a hostile and opportunistic bid by Telus,” said Louis Mosmann,a private wealth client and research assistant at Kodari Securities.
Appen said in its morning statement it had received an unsolicited,conditional and non-binding indicative proposal from Telus to acquire the company via a scheme of arrangement at a price of $9.50 a share - a 48 per cent premium to the stock’s most recent closing price.
Its shares soared as much as 35 per cent to a high of $8.64 after the announcement. The stock had been trading above $10 in February and above $40 in August 2020.
‘This is a hostile and opportunistic bid by Telus.’
Kodari Securities’ Louis Mosmann
Appen’s board indicated in the early statement it had engaged with Telus to solicit a higher offer and cautioned that there was no certainty that the talks would result in a deal.