Wallix Group (EPA:ALLIX) has received no less than two European takeover approaches from Thierry Dassault and Thales SA (Euronext: HO), with this triggering interest from a new, larger US player, Palo Alto (NASDAQ: PANW). This is likely to be successful, not only in terms of the implied deeper pockets, but also the strategic value to Palo Alto, which has thus far not been able to attain a meaningful foothold in European markets. The icing on the cake for Palo Alto would be acquiring by the backdoor, key French and German certifications, without which it is impossible to work for sovereign entities.
For Wallix Group, a fast-growing French cybersecurity company, to be once again in the frame as a takeover target is something which is in the interests of its Founder, Chairman and CEO, Jean-Noel Galzain who has 9% and Dassault (EPA:DSY) director Thierry Dassault on 6%. The only issue is of course the price. We have already treated to M&A activity back in March, said to be at €33, with KKR (NYSE:KKR) getting rebuffed in the wake of preliminary talks according to La Lettre.
With the shares now at €23, the previous €33 KKR offer appears on the mean side. It is understood that discussions on a deal would be successful at €40 plus, just above the €39.5 that French giant Thales has put on the table. This would have the backing of the companies most influential shareholders, at a price that would eclipse KKR’s offer by quite some distance.
With Palo Alto waiting in the wings we have the prospect of a competitive bid situation. This includes the prospect of KKR either returning to the fray, or the likes of Thales edging up through the €40 to seal the deal on PANW stepping forward.
Whatever the case it would appear that at current share price levels Wallix remains cheap and vulnerable to a takeover. It is a thriving company in the cybersecurity space, with its share of the European public sector particularly noteworthy.
Indeed, Thierry Dassault’s eponymous company is likely to bid for Wallix itself in order to thwart other bidders. Therefore, we are in a competitive bid situation, which could lead to some fireworks. Investment banks Parella Weinberg, Rothschild and BNP Paribas, are all said to be involved advising would be bidders.
