FreeAgent RBS deal is a sign of interesting times
Interesting times in the world of cloud accounting, especially in Scotland. And particularly if you're FreeAgent. CEO Ed Molyneux's small business accounting app group looks certain to be snapped up by Royal Bank of Scotland for £53 million.
This is a profitable deal for the company that floated on Aim in 2016 and that has about 50,000 users.
The board is recommending that shareholders accept the takeover offer. It prices the shares at 120p, a 40 per cent hike on the IPO and an 86 per cent bump on Monday's close.
Free access to its software
RBS had already been working with FreeAgent, giving its small business customers access to its software. The latest development's significance is definitely more than financial. Molyneux says it makes good financial and strategic sense and is a "game changer".
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"The lines between banking, accounting and tax are becoming increasingly blurred. And there are new opportunities for a more integrated experience between banks and accounting software that we believe will benefit businesses," he tells the company's Twitter followers.
"This offer provides us with a unique opportunity to progress towards our vision that we set out in 2007 when the company was founded."
Improve core product
"As part of a larger organisation we want to accelerate our growth ambitions in the micro-business and accountancy practice space, as well as significantly improve our core product," says Molyneux who will be a keynote Accountex speaker in May
"Olly, Roan and I - along with the rest of the executive team - will continue to lead the company and we’re more excited and committed than ever about the possibilities ahead."
RBS chief executive Ross McEwan says: "We believe that a technology-enabled solution for our business banking customers will make it easier for our customers to build their businesses safely and securely."
