MarketWise Surges on $17.25 Per Share Take-Private Proposal
The unsolicited all-cash offer comes from Monument & Cathedral Holdings, the company's controlling shareholder, representing a 20.6% premium.
MarketWise, Inc. (NASDAQ: MKTW), the financial research and software provider, saw its shares jump in pre-market trading after announcing it had received an unsolicited proposal from its controlling shareholder, Monument & Cathedral Holdings, LLC, to acquire all remaining equity and take the company private.
The all-cash offer of $17.25 per share represents a 20.6% premium to MarketWise's closing price of $14.30 on Wednesday. The proposal values the publicly traded entity's remaining shares in a deal that underscores the significant influence of its largest backer. The company's board of directors confirmed the receipt of the offer in a late Wednesday press release and stated it is currently under review.
This is not a typical external takeover bid. Monument & Cathedral Holdings, along with its affiliates, already wields significant power, controlling a majority of the company's voting rights. This existing relationship suggests a higher likelihood of the deal's completion, pending the board's fiduciary assessment and potential negotiations. The offer is contingent on the termination of the company's existing tax receivable agreement, a common step in simplifying a company's structure for a private transition.
MarketWise, a multi-brand platform known for its subscription-based financial research and tools aimed at self-directed investors, has navigated a challenging market. The stock has traded in a wide range over the past year, between a low of $8.22 and a high of $21.30. The proposed buyout price sits below the 52-week high, but offers a significant premium over its recent trading levels.
The company's recent financial performance has shown signs of struggle, with quarterly revenue growth down nearly 24% year-over-year, according to its latest filings. This performance may have spurred the controlling shareholder to pursue a new strategy for the company outside the glare and quarterly pressures of the public markets.
Monument & Cathedral Holdings has a history of actively seeking to influence MarketWise's direction. In late 2023, the firm entered into an agreement with company founder Frank Porter Stansberry to pursue significant corporate changes, including management and board shakeups, with the stated goal of improving efficiency and increasing cash flow. The current take-private proposal appears to be the culmination of that effort, providing a direct path for the controlling entity to implement its vision for the business.
The board has not provided a timeline for its review of the proposal but stated it would act in the best interests of all shareholders. The focus of the review will likely be on the valuation and fairness of the offer to the minority shareholders who would be cashed out in the transaction.
As of its last update, MarketWise had a market capitalization of approximately $40.2 million. The take-private offer suggests a new chapter for the Baltimore-based company, potentially allowing for a strategic overhaul without the scrutiny of public investors.