Pilat Media Global Ltd. (AIM: PGB; TASE: PLMG) today announced that it is in "advanced discussions with Sintec Media Ltd., which may or may not lead to a recommended offer being made by Sintec for all of the company's ordinary shares" at ₤0.265 per share. The company added, "The intention of the parties in these negotiations is to effect a merger between the two companies."
The offer was made at double Pilat Media's opening price of ₤0.13 on London’s Alternative Investment Market (AIM) today. The share jumped 69% on the AIM by mid-afternoon to ₤0.22 per share on the news, giving a market cap of ₤13 million. The share jumped 50% on the TASE to NIS 1.12.
Both Pilat Global and Sintec are Israeli companies that develop and market business management software for broadcasters. Founded eight years ago, Sintec has raised $24.5 million to date.
The credit crunch is creating merger and acquisition opportunities for public and private companies with deep pockets. Companies feel that to survive, they should exploit bargain-basement share prices to buy out their competitors before someone else does.
It will be hard for Pilat Media to refuse Sintec's offer, especially in the current market climate. Pilat Media has known better days - its share was traded at ₤0.43 on the AIM a year ago - but the credit crunch and cutbacks in capital investments by its customers has sent the company's share through the floor.
If the deal goes through, Pilat Global will delist from the AIM, further reducing the number of Israeli companies traded on it. The number of Israeli companies listed on the AIM has already fallen to 30 from 39.
Published by Globes [online], Israel business news - www.globes-online.com - on March 11, 2009
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