Skandia sights on Lynx's Bankhall

SKANDIA UK has emerged as the bidder stalking computer and support services firm Lynx by launching a recommended cash offer of 120p per share for the group.

The Southampton-based arm of the Swedish life group is executing the purchase through its IFA Services unit in a deal valuing Lynx at £210m.

The offer is at a 30% premium to the share price before Lynx said in November it was in talks with a potential suitor, and its shares rose 15p to 119p today. Only 18 months ago Lynx shares were trading at 367p.

Skandia intends to strip the deal down to acquire only Lynx's Bankhall financial services support business. As part of the transaction, Skandia will finance a £60m management buyout of the remainder of the Lynx group by chief executive Richard Last and finance director Paul Sinnet. Lynx acquired Bankhall in a cash and paper deal valuing the unit at £114m in April 2000. As part of the deal Lynx shareholders will be entitled to a second dividend of 1.9p per share.

Skandia, which has irrevocable acceptances representing 26.9% of Lynx's equity, said it expected the deal to be completed before March. Bankhall, based at Altrincham, Cheshire, would continue to operate independently and its 300 employees would keep their jobs, it said.

Skandia's executive vice-president Alan Wilson said his group was offering a 'fair price' for Bankhall, which is currently providing most of Lynx group's profits. Merrill Lynch is Skandia's adviser on the deal and Investec Henderson Crosthwaite is acting for Lynx.