The tussle for the Brisbane-based software company has raised the share price of the company from 6 cents in January to 22.5 cents.

The backflip in support follows a bidder’s statement from Humanforce, which said it held 19.9 per cent of IHR, and would use that vote against the offer from The Access Group which has offered 22 cents a share if the deal was done through a scheme of arrangement compared with the 19.5 cents from Humanforce.

Humanforce’s bidder’s statement said the TAG bid required 75 per cent of shares supported the bid.

At least 93 per cent of all intelliHR shares not controlled by Humanforce must be voted in favour to succeed, it said.

“Consequently, it is highly likely that the TAG scheme will fail,” Humanforce said.

However, intelliHR said today the Humanforce offer was inferior to the one from TAG.

It said a board committee formed to investigate the offers found that the Humanforce offer “has little prospect of being approved by the required majority of the company’s shareholders”.

“The board committee has also considered the greater consideration offered by TAG … the working capital facility offered by TAG as well as conformation from TAG that it had obtained Foreign Investment Review Board approval,” intelliHR said.

Given that, the board had decided to withdrew its recommendation for the Humanforce offer.

“The board committee considers the second TAG proposal, comprising the scheme and off-market takeover bid has a good prospect of success.”

intelliHR said it had now entered into a transaction implementation deed with TAG and withdrawn from scheme implementation deed with Humanforce which would cost it a break fee of $390,000.