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Bain Capital’s buyout bid shows the risks of investing in a company with big shareholders

Founding investors in Switzerland’s SoftwareOne are backing a buyout bid that suits them fine. Should they care if the offer is bad news for everyone else?

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    • Stocks with dominant holders should command lower valuations to capture the fact that smaller shareholders are disadvantaged.
    • Stocks with dominant holders should command lower valuations to capture the fact that smaller shareholders are disadvantaged. PHOTO: REUTERS

    DeeperDive is a beta AI feature. Refer to full articles for the facts.

    Chris Hughes

    Published Tue, Aug 1, 2023 · 05:05 PM

    SHAREHOLDERS with big stakes are kingmakers in takeovers. With power comes responsibility – but to whom?

    A contested Swiss bid situation is forcing the issue.

    The founding shareholders of tech company SoftwareOne collectively own 29 per cent and are fine with the roughly 3.2 billion Swiss francs (S$4.9 billion) indicative bid being dangled by US buyout specialist Bain Capital. They’ve cut a deal whereby they would sell only some of their stake and keep “a significant part” invested as the company went private.

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