Grindr Inc’s two largest shareholders have reportedly withdrawn their planned US$3.46 billion (A$5.36 billion) offer for the company soon after it ended talks due to worries about how they would fund the bid.
Ray Zage and James Lu, who own more than 60% of the same sex dating app’s shares, said they had received strong interest from lenders and investors to support the transaction, according to a Reuters story.
They had offered $18 per share last month, which was a 51% premium over the company's stock price at the time.
Grindr said the Special Committee of its Board of Directors had decided to cease engagement with respect to a non-binding, unsolicited take-private proposal from Zage and Lu.
“The Special Committee made this determination due to continued uncertainty as to the financing for the Proposal,” the company said in a news release.
The Committee had decided that further talks and discussions were not in the best interests of shareholders, but remained confident about Grindr’s ability to create significant value for all shareholders as the management team executed its long-term strategic plan.
Zage said he intended to buy more Grindr shares and urged the board to expand stock buyback and consider dividends, according to Reuters.
The share price (NYSE: GRND) closed 33 cents (2.62%) higher at $12.94 on Wednesday (Thursday AEDT), capitalising the company at $2.31 billion.
Grindr, which describes itself as the ‘Global Gayborhood in Your Pocket’, has more than 15 million average monthly active users and is available in more than 190 countries.
