Offer to acquire Task Group is frothy

Recap

Last week we looked at Task Group, Task Group helps businesses, like restaurants and cafes, set up and manage the systems they use to take orders and payments.

They merged with Plexure, a customer engagement & loyalty platform, which led to some strong growth in recent years, with the first half of 2024 up 36% compared to the same period in 2023.

Current Market Cap

Task Group currently has a market cap of $281.5m, with the share price increasing from $0.40 two weeks ago to $0.79 today, a 97.5% uplift. This increase is driven by the bid presented from US tech company, PAR Technology, offering $0.81 per share.

The Task Group board has unanimously recommended shareholders vote in favour of the takeover, acknowledging the potential to create “meaningful synergies” through an expansion of PAR’s geographic coverage.

Valuation Multiples

Task Group is trading significantly above EY’s Revenue Multiple trend for Information Technology companies, even prior to PAR Technology’s bid. The premium placed on Task Group is due to the impressive recent growth figures and the future potential of the company.

Further analysis into recent comparable transaction is required to consider whether Task Group is appropriately valued but it is clear that the expectation is that the company will continue its strong growth trend in the near future.

Investment Thesis

Task Group CEO Daniel Houden said he was “excited” by the combination of Task and PAR.

“[This transaction] offers Task a better base on which to achieve our international ambitions. It provides a strong group with significant opportunities for our employees and provides certainty for our shareholders who have supported the growth of Task to become a meaningful player in the global retail software market.”

PAR Technology president Savneet Singh echoed Mr Houden’s comments.

“The combination of the two most complete technology solutions in our industry is incredibly exciting. Together, PAR and Task will serve our respective customers globally and create a talent base we believe to be unmatched in the industry.”