Adam Schwab: Nitro rejects $400 million Potentia offer despite rising costs and recorded losses

While the slow-motion global tech market rout continues to play out, another entrant has emerged in the global falling knife catching competition. Previously low-profile Sydney-based private equity firm, Potentia, is betting on Australian ASX-listed but US-centered, Nitro PDF.

Potentia is a semi-reincarnation of Archer Capital’s private equity business and includes former MYOB boss and now Business Council chair, Tim Reed. The firm is separately bidding for embattled payments business Tyro.

Nitro is an Australian version of the ubiquitous Adobe PDF software. In announcing its rejection of Potentia’s bid, Nitro claimed the $400 million offer “does not adequately compensate shareholders for Nitro’s position as one of only two software companies worldwide with a proven enterprise-grade SaaS PDF productivity and e-signing platform, and a uniquely powerful and differentiated solution offering in a fast-growing global market worth $US28 billion”.

‘Enterprise grade’ PDF software sounds slightly curious — it is perhaps questionable whether BHP or Commonwealth Bank workers need an enterprise grade PDF tool, but we’ll take Nitro’s word for it that their product has extra features which aren’t included in the (often free or quite cheap) alternatives.