Acquisition
10/07/2023 07:00
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RNS Number : 4010F Sopheon PLC 10 July 2023
SOPHEON PLC
("Sopheon" the "Company" or the "Group")
Acquisition of Prodex business expands Sopheon's global footprint
Sopheon (https://www.sopheon.com/) plc, the InnovationOp
(https://www.sopheon.com/innovationops) s
(https://www.sopheon.com/innovationops) software company, is pleased to
announce the acquisition of the business and assets of Prodex Systems
Australasia ("Prodex"), a specialist provider of innovation software and
consulting based in Brisbane, Australia.
Now doing business as Sopheon Asia Pacific, the former Prodex business is
focused on markets in Australia, New Zealand and South-East Asia and has a
number of customers in the region from the food and beverage, chemicals and
mining sectors. The acquired business has been Sopheon's reseller in Australia
for over a decade and is a healthy and profitable business with revenues for
the year ended June 2022 of AUD $1.5m with EBIT of AUD $0.15m. Financials for
the year just ended are expected to be at broadly similar levels, with good
pipeline visibility for the remainder of 2023. Historically, approximately AUD
$0.3m of Prodex revenues have been included in Sopheon's revenues annually,
through reseller recharges.
Rationale for acquisition
In the previous 18 months Sopheon has completed two M&A transactions with
the acquisition and integration of ROI Blueprints and Solverboard, both of
which brought important technology assets to the Group that have now been
further developed and launched as Acclaim Projects and Acclaim Ideas,
respectively. Alongside internally developed Acclaim Products, the launch of
these new solutions expands Sopheon's addressable market by an estimated $2bn
and boosts the Group's position as the leading software vendor focused on
operationalizing the business of innovation.
As signposted in previous announcements, we have turned our attention to
leveraging M&A to add revenue and geographical footprint. The acquisition
of the Prodex business, that we know very well thanks to many years of working
closely together, brings the group a strong and stable platform to advance
customer acquisition and growth in the world's most dynamic region, giving the
group a truly global footprint. Prodex, led by Gerard Ryan, has built an
enviable reputation and an impressive roster of customers.
Deal structure and consideration
The transaction was structured as transfer of business and assets into a new
company immediately acquired by Sopheon. The consideration comprises AUD $1m
of which two thirds is payable immediately in cash, and the remainder over
three years as contingent deferred consideration tied to baseline performance
metrics. An additional contingent earn-out of up to a maximum of AUD $1.2m is
also payable over the next three years, tied to revenue and EBIT growth
objectives. Up to 50% of the deferred and earn-out consideration may be
satisfied in Sopheon shares issued at £5.63 per share being the average
closing price of the two weeks preceding the signature of the agreement. The
cash consideration component of the acquisition is being funded out of
existing and healthy cash resources. The share consideration elements will be
subject to orderly market provisions.
Greg Coticchia, CEO of Sopheon, said: "This is Sopheon's third acquisition in
19 months and the latest evidence of the strong momentum that our company is
experiencing. With companies throughout South-East Asia increasing their
innovation investments, it's fitting that Sopheon's first acquisition to
expand our geographic presence be in this expanding market. Prodex, a
long-time reseller of Accolade, assists innovative and successful companies to
make better, quicker decisions and increase speed to market. Sopheon's
innovation leadership continues to expand as a result of our consistent growth
in product offerings, customer implementations and global reach."
Prodex founder and CEO Gerard Ryan added: "The transition for Prodex to become
a Sopheon entity is an exciting extension of the reseller agreement we have
had in place for many years. We are already working with Sopheon in Australia,
New Zealand, and Thailand with market development plans in place for the wider
South-East Asian region. We're excited by the synergy of immediate geographic
expansion for Sopheon in this highly innovative and high-growth region, while
also enabling true 24/7 coverage for Sopheon's global customer base."
For further information contact:
Andy Michuda (Executive Chairman) Sopheon plc + 44 (0) 1276 919 560
Arif Karimjee (CFO)
Carl Holmes/Abigail Kelly/George Dollemore (Corporate Finance) finnCap + 44 (0) 20 7220 0500
Alice Lane / Sunila de Silva (ECM)
Sopheon(®), Accolade(®) and Acclaim™ are trademarks of Sopheon plc. All
other trademarks are the property of their respective owners.
About Sopheon. Sopheon (LSE: SPE) empowers organizations to change the world
while achieving exceptional long-term revenue growth and profitability. By
operationalizing the entire innovation life cycle, Accolade® and Acclaim™
software and expertise enable innovation, product and project professionals to
accomplish the full range of InnovationOps tasks to drive innovation at scale.
Sopheon's industry leadership was highlighted in the comprehensive
MarketsandMarkets™ report on the Innovation Management market, in which
Sopheon was listed in the "Stars" category, the highest recognition. Sopheon's
solutions have been implemented by hundreds of blue-chip customers with over
137,000 users in 50 countries. Sopheon is listed on the AIM Market of the
London Stock Exchange. For more information, please visit www.sopheon.com
(http://www.sopheon.com) .
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