(Reuters) - IHS Inc IHS.N is preparing to submit an offer next week for Solera Holdings Inc SLH.N, the software maker that agreed this month to sell itself to Vista Equity Partners LLC for $6.5 billion, including debt, people familiar with the matter said.
IHS, an information services firm, is looking to reduce its exposure to the energy sector after several of its clients slashed spending amid plummeting oil prices. It sees synergies between Solera, whose software is used for the processing of car insurance claims, and R. L. Polk & Co, an automotive data company that it acquired in 2013, according to the sources.
IHS is planning a stock-and-cash offer that will exceed Vista’s offer of $55.85 per share, the people said on Friday. It has lined up at least three banks to provide debt financing for its offer, the people added.
Reuters first reported that Solera and IHS were in talks before Vista Equity, a technology-focused private equity firm, clinched a deal. IHS wants to make its offer next week so it has enough time to negotiate a deal with Solera before Oct. 11, the sources said. After that point, the deal termination fee that Solera would have to pay Vista Equity to agree to sell itself to IHS rises from $38.2 million to $114.4 million.
IHS’s market capitalization is $7.6 billion. Given that Vista Equity’s offer was all in cash, IHS will have to show that its currency is valuable enough for its bid for Solera to be superior, the people said.
The sources asked not to be identified because the deliberations are confidential. IHS and Vista Equity declined to comment, while Solera did not respond to a request for comment.
Based in Englewood, Colorado, IHS provides research and analysis across various industries for business and governments in 150 countries. It has expanded into the automotive space in recent years and now owns CARFAX, which provides vehicle history information for buyers and sellers of used cars and light trucks, as well as used car listings.
Solera, based in Westlake, Texas, processes more than 230 million insurance transactions annually in 75 countries under brands such as Audatex. It was founded in a garage in 2005 by CEO Tony Aquila.
Reporting by Liana B. Baker in New York; Editing by Christian Plumb