Tern PLC (LON:TERN), the investment company specialising in the cloud and mobile sectors, is to buy Flexiant, a provider of cloud management software.
Tern has held a 1% interest in Flexiant since November 2013 and is now set to take full control, subject to the completion of due diligence.
Tern has agreed to issue 8mln shares to Flexiant Corporation Limited (FCL), the owners of Flexiant, as consideration for the acquisition.
There is also a trigger clause based on the possible sale of Flexiant’s Concerto, Flexiant's multi-cloud workload management solution; should Tern sell the Concerto business for more than £6mln, then FCL would receive half of any amount in excess of £6mln, subject to a maximum of £2mln.
Tern will also take on all inter-company debt owed by Flexiant to FCL.
The acquisition is conditional on the consent of the holders of FCL loan notes and the sale by Flexiant of its Flexiant Cloud Orchestrator business. The sale of the Flexiant Cloud Orchestrator business is imminent, FCL has informed Tern.
In 2014, Flexiant made an operating loss of £3.9mln on turnover of £750,000.