Mainstream is pursuing a scheme of arrangement with SS&C Technologies Holdings after Vistra missed its deadline to match or provide a superior offer.
The Mainstream board unanimously recommends the SS&C proposal on the basis that it is a superior offer and is now taking steps to terminate the Vistra scheme implementation deed and pay the $1.7 million break fee.
SS&C's offer is to acquire 100% of Mainstream at $2 per share, valuing the company at $285.7 million.
The valuation is 25.8x Mainstream's EBDITDA guidance and is an 87.2% premium to its equity of $152.6 million.
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SS&C's offer is at a 67% premium to Vistra's offer. As such, Mainstream has notified Vistra to either match or make a better offer by April 16.
"The board considers the SS&C scheme to be a very positive outcome of a successful 'go shop' period, as it resulted in a significant 66.7% premium to Mainstream shareholders when compared to Vista's scheme consideration of $1.20 per share," Mainstream said in a market statement.
"The board also considers SS&C to be well positioned to acquire and, thereafter, control Mainstream and that Mainstream's services will complement SS&C's offering in Australia and offshore."
Mainstream noted that once the Vistra SID is terminated and the break fee has been paid, the SS&C SID will become fully operative.
SS&C is a US-based global software and services provider for financial services and healthcare. The acquisition would accelerate the company's growth in the Australian market and would retain Mainstream chief executive Martin Smith.
Mainstream is being advised by Miles Advisory Partners as financial adviser and Maddocks as legal adviser and SS&C is being advised by Citi as financial adviser and Gilbert + Tobin as legal adviser.