Eleco has agreed to an all-cash acquisition offer from the private equity firm, Accel-KKR, for an enterprise value of £207.6m.

The offer from the California-headquartered company, valued at £2.35 per Eleco share, represents a 74.4% premium on the construction software firm’s closing share price yesterday.

The private equity firm said that in the past few years, Eleco has transformed its business from its “heritage in building and light equipment production to a technology business with a strong position in the building lifecycle technology market”.

It added that it believes it can support Eleco in its continued product development, SaaS transition and AI implementation, to maximise its market opportunity.

Following the announcement, shares in Eleco jumped by 70%.

Non-executive chair at Eleco, Mark Castle, stated: "Eleco has successfully transformed from a building products business to a specialist provider of software and related services to the built environment. Alongside this business transformation, Eleco has successfully transitioned its business model from perpetual software licences to subscription and SaaS-based revenues while maintaining profitability. All our colleagues and shareholders should be proud of these achievements.

“Following the acquisition, the Eleco board believes that, with the support of Accel-KKR, Eleco will be better positioned to grow the business for the benefit of customers and colleagues.

“The Eleco board has unanimously concluded that they intend to recommend this offer, which provides a compelling return for our shareholders and is in the best interests of shareholders and wider stakeholders."

Managing director at Accel-KKR, Maurice Hernadez, added: "Eleco has built a leading construction technology platform with a strong reputation among its customers through its domain expertise, and we look forward to partnering with the Eleco team to build on that foundation and support the company's next phase of growth."

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