A Major Payday Ahead — Micro Finland’s Largest Holding, WithSecure, to Be Acquired at a 70% Premium
For the attention of media representatives: We will not comment on WithSecure beyond this text for as long as the special situation is ongoing or until the fund has tendered its shares.
Summary
- A tender offer for WithSecure was announced this morning, 8 August 2025, at a premium of approximately 72.1% to the previous day’s closing price and 94.0% to the volume-weighted average price over the preceding 12 months. The announcement can be read here. In our view, the offered price is reasonable, although we had hoped for more. Based on the tender offer, the total value of WithSecure’s shares is approximately EUR 299 million.
- WithSecure is Micro Finland’s largest holding, with a portfolio weight of almost 10% before the tender offer. The offer therefore increases the fund’s value in one day, all else equal, by almost 7%. WithSecure’s weight in the fund will rise to nearly 17% of fund assets.
- A traditional UCITS fund would immediately have to sell a significant portion of its shares to avoid breaching the 10% investment limit. Micro Finland is a non-UCITS fund, which means that, should we so choose, we can wait for a potential competing offer or an increased offer without breaching investment limits.
- WithSecure is the most significant tender offer in the portfolio management careers of Mika Heikkilä and Olli Viitikko when taking into account the combined effect of the offer premium and portfolio weight. In terms of significance, it even exceeds the Comptel tender offer from 2017.
- Micro Finland is a significant shareholder in WithSecure. The fund owns 4.3 million shares, corresponding to 2.44% of the company’s total share capital. The fund is the fifth-largest shareholder on the shareholder register.
- The tender offer serves as a reminder that the pricing mechanism in many Finnish small caps is currently severely malfunctioning. A correction can happen in many ways, of which a tender offer is one. Private equity investors, for example, are almost certainly looking at several opportunities on the Helsinki Stock Exchange right now. It is unfortunate that the listed valuations of many companies currently remain far below their potential, but at the same time this creates opportunities for diligent investors.
- Micro Finland will continue to invest in Finnish small and mid-sized companies with a long-term horizon, just as it has done so far. Let this WithSecure windfall serve as a reminder that there is indeed potential, even when the journey sometimes feels difficult.
A Difficult Journey Appears to Be Coming to an End for Public Market Investors
When we began managing the Proprius Partners Micro Finland non-UCITS fund in spring 2023, one of our first purchases was WithSecure, a cybersecurity company that had recently separated from F-Secure and which we found highly interesting.
We were fairly confident that following the separation of the two companies, at least one of them would eventually become an acquisition target, and we considered WithSecure the more likely candidate. Among other things, we liked the company’s modest market capitalisation and valuation multiples, the growth opportunities in the industry, the previous track record of the then management team and the turnaround potential of the business — even though we are not exactly fans of turnaround investing as a category.
At the time of our initial purchase, however, we could not have anticipated how difficult the road ahead would be for WithSecure operationally. To put it bluntly, the business has been a painful slog throughout our ownership period, and investors’ patience has been tested from several directions on multiple occasions.
It is also clear that WithSecure’s hand has weakened during our ownership period. The competitive environment has deteriorated, and the company has effectively been forced out of the large-enterprise segment and into the small and mid-sized company market. That said, a great deal of good work has also been done: the company’s business foundation has been stabilised, consulting has been sold, and the Salesforce business has been put on a pleasant growth trajectory. In that sense, it would have been nice to continue from here in the normal course of business. If one believed that the company’s stated financial targets were achievable, the company’s price tag could be imagined at a very different level.
WithSecure is the company that has by far generated the most discussion among Proprius Partners’ clients of all Proprius investments. And we can say that the tone of those discussions has mostly been puzzled, frustrated or even outright negative. Despite those discussions, we continued to add to WithSecure along the way as the share price drifted lower, although it did not always feel easy.
Those who invest publicly are exposed to a kind of pressure that, at worst, can lead to overthinking and poor decisions. This time, we feel we kept our heads. Some may no doubt think we are two idiots who ran through a dynamite factory holding lighters and survived only by luck.
Following the tender offer, the assets under management of Proprius Partners Micro Finland are approaching EUR 50 million. A warm thank you to our clients for your trust. Patience is often rewarded. We will see how the tender offer proceeds. We have no certainty that it will be completed, so we will have to live with uncertainty for at least some time.
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