Potential sale sends Hexagon higher
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Potential sale sends Hexagon higher

According to the Wall Street Journal, Swedish industrial technology company Hexagon may be in early stage talks over a possible sale. The paper cited an anonymous source who was close to the matter, saying that the company had been in talks with a U.S. or European rival that could value the company at around $20 billion. This had a marked effect on Hexagon’s share price, which rose on the back of the news.

Hexagon’s share price has appreciated by 40%, year-to-date

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SOURCE: Yahoo Finance

Firms like Hexagon, which specializes in industrial software and technology, are seeing increasing demand in the market. This is a reflection of the ongoing trend towards automation and the utilization of digital data – both areas that Hexagon has a significant offering in.

A statement released by the company last week said that it “regularly evaluates various opportunities to optimize the company’s positioning and shareholder value. Should these evaluations lead to concrete results, the market will be immediately informed.”

Interest in the statement helped to drive Hexagon’s share price up by more than 17% the following morning, but some analysts feel that the price being offered is too low. Swedbank analyst Mathias Lundberg said that a deal was possible, but not at the value reported:

“If you look at the price tag it’s too low to let Hexagon go. And the company has a long way left on its own journey. They are merely at the beginning of the whole digitalization part.”

Disclosure

Dominion holds Hexagon in its Global Trends Managed Fund.


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