IRISH SOFTWARE firm Iona Technologies has selected a preferred bidder and is negotiating a sale of the firm for a price believed to be in excess of $4.50 a share.
Last night, a spokeswoman for Iona reiterated that the board would not make a statement on the matter unless it "withdraws or concludes" the sale process.
However, it is understood the company wants to bring the process to conclusion by the end of the month.
Earlier this week, Software AG, the German firm whose preliminary expression of interest forced Iona to concede it was the subject of a bid, confirmed it was not in the running to buy Iona.
Sources close to the negotiations have stated that open source software company Red Hat and network giant Sun Microsystems were not the preferred bidder.
Iona is being advised by Lehman Brothers in the US and Merrion Capital and Davys in Ireland.
Iona management is said to prefer a bid that would take the company private.
Iona stock performed strongly after it floated on the tech-heavy Nasdaq stock exchange in 1997.
In recent years, however, it has failed to deliver revenues or profits in line with its guidance on a number of occasions.
In 2007, the company had revenues of $77.7 million and a pretax loss of $1.7 million. The company expects revenues for 2008 to be in the range of $80-85 million.
A bid of $4.50 a share would value Iona at over $165 million. At the end of March, the company had $55 million in cash on its balance sheet.
The largest shareholders in the company are US investment houses Peninsula Capital and Goldman Sachs, which hold more than 25 per cent of the stock.
Chris Horn, who co-founded the company with other Trinity College researchers in 1991, holds 6.35 per cent of the company, putting him in line for a windfall in excess of $10 million.
Following a reorganisation at the beginning of the year, which included closing an office in China, Iona now employs about 360 staff, primarily at offices in Dublin and Massachusetts.
