It’s been a busy old week for M&A in TMT this week, here’s a quick round-up of some of the major activity:
The biggest news of the week was probably the £1bn acquisition of document capture and smart process applications developer Kofax by printing giant Lexmark. The deal tracks a continuing trend towards combining hardware and software approaches in Business Process Automation market and sees Lexmark paying around 3.4x revenues for the privilege. Lexmark has been focusing on building its software and imaging business for some time as its core business continues to decline. Kofax will join previous acquisitions Readsoft and Perceptive Software to create a software division with around $700m in revenues.
In another public company deal this week we saw Manchester-based NCC Group launch a takeover for AIM-listed security services specialist Accumuli valuing the business, which has had a bit of a chequered history, at around £55m. NCC, which provides a range of services including escrow, software testing and domain services, picked up the business to boost its capabilities in round-the-clock operational support and incident management. Accumuli was forecasting revenues of around £22.4m and EBITDA of £3.8m for the year to March 2015 implying revenue and EBITDA multiples of 2.6x and 14.5x and stressing the ongoing value of security assets in the market.
In other IT services news this week SCC proved that it is continuing to spend some of the cash pile it is sitting on following the sale of its distribution division by announcing the acquisition of Fluidata, a provider of high-speed data connectivity solutions. Terms were not disclosed. SCC is indicating that its services business has increased 25% in the last year thanks to acquisitions including print services business M2 and some organic growth, and now stand at around £165m.
And finally MXC Capital, which acquired Calyx from Jon Moulton’s Better Capital last month for £9m, announced that it was selling off a couple of the divisions of the business to telecoms businesses Daisy and Chess for around £5.5m. Daisy is picking up the break/fix business for £3.75m whilst Chess are taking the carrier services arm for £1.8m.
And finally, in telecoms we saw UKBroadband, a subsidiary of Hong Kong-based telecoms business HKT, announce that it had acquired Keycom, a provider of broadband and communication services to student accommodation providers, military accommodation and retirement villages in the UK for £11.8m.