Investors are getting conflicting advice from independent proxy advisors on whether the takeover price for cybersecurity firm Magnet Forensics Inc. is fair.

Glass Lewis & Co. has recommended against the deal, saying the valuation for the Waterloo, Ont. based company is inadequate and that the proposed premium is "marginal" at best.

The advice comes a day after Institutional Shareholder Services Inc. encouraged shareholders to vote for the deal, saying the valuation appears "reasonable" and that there are downside risks if the deal isn't approved.

Magnet Forensics announced on Jan. 20 that U.S. private equity firm Thoma Bravo would buy it in a $1.8-billion deal, which would see shareholders and their affiliates receive $44.25 in cash per share, while rolling shareholders will nab $39 per share.

When announced, the deal amounted to a 15 per cent premium on the closing share price a day earlier and a 41 per cent premium on its 90-day average.

Magnet Forensics' board of directors has said the deal with Thoma Bravo maximizes the valuation of the company and that the Glass Lewis analysis is flawed, while major shareholder Nellore Capital Management LLC has pushed against the terms as inadequate and welcomed the recommendation. 

This report by The Canadian Press was first published March 15, 2023.