Sign up UNITED KINGDOM
Proactive Investors - Run By Investors For Investors

Proactis reverses UK/US merger trend with £100mln Perfect Commerce deal

Perfect Commerce sells cloud-based software to 150 business and public bodies
picture of cloud computing
Perfect Commerce is highly complementary says Proactis

Management consultant group Proactis Holdings (LON:PHD) is to almost double in size with the acquisition of specialist management software group Perfect Commerce.

It comes in a week that has already seen two chunky US/ UK mergers in the shape of Worldpay/Vantiv and Novae/Axis Capital.

This time it is AIM-listed Proactis that is the buyer, raising £70mln through a placing at 165p to help pay for the £102mln consideration, with a new debt facility to cover the remainder.

On completion, however, the chief executive of Perfect Commerce, George Wall, will take over as the boss of the enlarged group as Rod Jones retired as Proactis’s CEO yesterday.

Perfect Commerce sells cloud-based software to 150 business and public bodies and also has a business network that enables customers to transact with suppliers.

Tim Sykes, who is staying on as chief financial officer, said Perfect Commerce is highly complementary, with the deal to be earnings enhancing in the year ending July 2018.

“It accelerate Proactis' growth and bring substantial global scale to the Group, positioning us to exploit the high growth areas of the spend management market and enabling us to provide our customers with an even broader product offering.”

House broker finnCap said it was a great deal.

"The increased scale offers enhanced growth opportunities, extending current UK focus deeper into the US, and mainland Europe; broadens the tier 2 customer base into tier 1; extends the UK public sector focus into the private sector; adds material supplier-led revenue to the buyer-led revenue model with Perfect Commerce’s mature Business Network; and brings evident cross-selling potential based on the contributory companies’ specialisations."

The broker has upgraded its foreacasts signficinatly, the underlying profit forecasts rises 122%, as the acquisition accelerates Proactis board’s strategy by five years and creates a global force in the spend management environment.

Target price rises to  250p "with much more upside-potential available following momentum from proof of execution".

Proactis shares rose 7% to 187.5p.

 

-- adds share price, broker comment--

View full PHD profile View Profile

Proactis Holdings Plc Timeline

Newswire
February 11 2016

Related Articles

Lucky Wingabar gaming app
May 09 2017
The Myanmar-language social media platform saw daily revenues increase by almost 30% at the start of this month compared to April
Office productivity
September 11 2017
It would have been somewhat embarrassing had an office productivity software firm not got its flagship product delivered on time, but fortunately BOS did
online payment
July 07 2017
The cash influx will give the proposed new board the financial muscle to take the e-commerce enabler to the next step

© Proactive Investors 2017

Proactive Investor UK Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use