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EDB Business Partner has entered into an agreement to acquire 60% of the Ukrainian IT company Infopulse Ukrania LLC. Infopulse has 300 highly qualified employees with many years experience of nearshoring business with West European and American companies as its customers.
“Infopulse will be a spearhead for EDB’s nearshoring. We are buying a company with very strong technical expertise, and this will help to strengthen EDB’s delivery to both new and existing customers. This is a very important investment for EDB, and we expect to reap the rewards over future years”, explains Endre Rangnes, CEO of EDB.
More about the business acquired
Infopulse Ukraina was established 1992 and currently has 300 highly qualified employees. As many as 82% of the company’s employees hold a Masters level degree in ICT. The company reports good profitability, and its revenue grew by over 50% in 2006 to around NOK 40 million. The company reports an EBITA margin in line with EDB’s margins.
The company’s business is very largely concentrated on international customers outside the Ukraine. Infopulse has customers in Germany, Switzerland, Great Britain, Belgium, France, Holland, Sweden, Denmark and the USA. The company has worked for a number of years on developing software for the banking industry, and has collaborated with major European banks for several years. Infopulse uses state-of-the-art development methodology and is ISO -9001 certificated. The company is familiar with most of the current technology platforms, and its areas of particularly strong expertise include Java and Microsoft technology. Infopulse has good access to skilled staff, and its current business model for delivery to international customers offers significant potential for growth. The focus on this area of its business will continue undiminished.
“With the help of Infopulse, EDB will be able to take on more customer projects and achieve even stronger organic growth”, comments Endre Rangnes.
More about the transaction
EDB is to acquire a 60% interest in Infopulse’s business from the company’s management, who will retain an interest in the business through their ownership of the remaining 40%. EDB expects to pay approximately USD 6 million for this acquisition, of which USD 2.5 million will be payable when the purchase takes place. The total amount finally paid will depend on the company’s earnings performance in the period to 2007 to 2009. EDB has also entered into a contract for an option to acquire the remaining 40% of the share capital of Infopulse. The acquisition is conditional on approval by the relevant authorities, satisfactory completion of due diligence and agreement on the final form of the purchase agreement.
Binding agreements have been entered into with key individuals at Infopulse to ensure that they continue to work for the company. Infopulse will be a separate company in the EDB group. The transaction is expected to complete at the start of the second quarter of 2007.