IBM Consulting, formerly IBM Global Business Services, will acquire Dialexa, a product engineering services (PES) vendor headquartered in Dallas, TX.
Meet Ratos: the New Owner of Semcon. Outbids Etteplan
Ratos Offers A 5% Premium over the Etteplan Offer for Semcon Etteplan’s offer for Semcon seemed
Assystem Puts an End to its Oil & Gas Debacle
Assystem has put an end to its oil & gas debacle with the end of 51% of MPH to its management.
Modis Comes Into the Light with Akka
Modis came into the light two weeks ago when Adecco announced the acquisition of Akka. Modis is a decently large IT services firm with 2020 revenues of EUR 2,179m. It is little-profitable with an adjusted EBITA margin of 5.7% (2019: 6.3%). Like everyone, the company faced headwinds in 2020, with revenues down 9% in 2020 (2019: -3%).
When Will Sweco Make A Significant Acquisition?
It has been five years since Sweco made its last significant acquisition. In 2015, the company took over Grontmij, which brought 6,000 employees and revenues of EUR 659m.
Hitachi Buys GlobalLogic for USD 9.6bn. A Shock to the ER&D industry
The Hitachi USD 9.6bn acquisition of GlobalLogic was a shock to the engineering and R&D service industry. Hitachi values GlobalLogic 37.4x its calendar 2021 adjusted EBITDA. The multiple is very high, even for a firm of the quality of GlobalLogic. Only three years ago, Apax sold its 48% stake in GlobalLogic to Switzerland-based Partners Group. At the time, the transaction valued GlobalLogic USD 2bn. Back then, the USD 2bn valuation seemed in line with the Aricent and Luxoft respective acquisitions by Altran and DXC.
Charles River Gains Large Molecules Expertise, Targeting Biotechs
Charles River Labs (CRL) will gain further expertise for biotechs. The company is to acquire San Francisco-based Distributed Bio, a large molecules specialist firm focusing on antibody discovery. Distributed Bio will become part of CRL’s core R&D business, Discovery & Safety Assessment.
Tuck-In Acquisitions Continue Despite the Stock Markets Melt-Down
Despite the stock market melt-down, ER&D vendors have continued to make tuck-in acquisitions in the past two weeks. The acquired firms were of small size and not likely to impact the net debt of their new owners. However, should the Covid-19-China-US trade-war-Stock Markets meltdown-oil price crisis degenerate into a recession, we expect suck tuck-in acquisitions to become scarce.
What An Economic Recession Means to the ER&D Industry
The US Federal Reserve yesterday lowered “the target range for the federal funds” by 50 bps to 1%-1.25%. Although the “fundamentals of the US economy remain strong,” “the coronavirus poses evolving risks to economic activity,” communicated the Fed.
Capgemini Secures 53.4% of Altran and Becomes Worldwide Leader in ER&D
Capgemini has succeeded with its offer to purchase Altran. The company has secured 53.4% of Altran’s capital. According to France’s financial market’s authority, Capgemini will reopen the tend offer from January 28 to February 10.
Sweco Acquires An Architecture Bureau in Belgium
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Capgemini Increases Its Tender Offer for Altran by 3.6%
Capgemini modestly increased its tender offer for Altran by 3.6%, from €14.0 to €14.5 per share.
Ricardo Sells Dolphin N2 to CNH Industrial
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Charles River Labs Acquires Hemacare for USD 380m
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UPDATED: Altran’s Share Trading Close to Capgemini’s Offer
Despite regular announcements that Elliott has increased its long positions on Altran’s shares, Altran’s share has been trading in the range of €14.08-14.20, close to Capgemini’s €14 offer. And since the announcement of the take-over, Altran’s share has not gone beyond €14.78.
Akka Raises EUR 175m in Convertible Bonds. But Why?
We don’t usually comment on the financial performance of ER&D service vendors beyond their financials. But this time, this is a little bit different: Akka Technologies raised yesterday EUR 175m in convertible bonds, a significant amount for Akka, which has a market cap of EUR ~EUR 1.2bn.
Capgemini’s Acquisition of Altran Delayed by Elliott by Up to Five Months
Capgemini’s acquisition of Altran will be delayed by up to six months. Edge Fund Elliott has, through intermediaries, brought, the case to court. The initial ruling on December 4 will decide if the acquisition will be suspended. A final ruling will occur by end of the March at the latest.
Thoughts About HCL Tech’s Performance in Q2 FY20
HCL Tech’s ERS accelerated its yoy growth in Q2 FY20 to +15.0% at CC, from +13.3%. Its EBIT margin also increased from 16.0% in Q1 to 21.4% in Q2. The financial improvement results from mostly a catch-up effect: ERS recognized revenues in Q2 that it could not in Q1.
Accenture Acquires Two Firms in October YTD
It has been almost three years since Accenture launched Industry X.0, and we estimate that Accenture acquired nine competitors in these 36 months. The pace is accelerating with Accenture having five competitors in 2019, YTD.