Brave Bison has submitted a £43.1 million takeover bid for System1 despite opposition from the board of the marketing effectiveness research firm, which is also a publicly listed business.
The cash-and-share offer from Brave Bison values System1 at £43.1m, equivalent to 20x FY26 operating profit and a 65% premium to its share price on 27th February, before Brave Bison announced its initial investment in System1.
Brave Bison said it has consulted shareholders representing approximately 14% of System1’s issued share capital, although it didn’t say whether they had agreed to vote in favour of the bid. Brave Bison is System1’s largest shareholder and currently owns 28%, having made a strategic investment in March which included a share exchange with System1’s founder John Kearon (pictured), who now has an 8% shareholding in Brave Bison and is no longer involved with System1.
The offer has a minimum acceptance condition of more than 50% of System1’s voting rights, including Brave Bison’s existing holding.
Brave Bison, parent company of SocialChain, said the enlarged group would generate net revenues of £79m and adjusted EBITDA of £14m.
Unlike the initial mooted offer, the concrete revised offer includes a cash component and represents an increase of 10% on that original bid. System1’s board rejected both offers in principle as they ‘materially undervalue’ the firm.
If the deal goes through, System1 shareholders would own around 14.5% of Brave Bison under the main cash-and-share offer, or around 21.8% under the alternative all-share offer.