8th Nov 2013 14:52
LONDON (Alliance News) - SQS Software Quality Systems AG said Friday that it had conditionally raised around GBP11.4 million in a share placing, which it intends to use in the acquisition of a majority share in software testing company Thinksoft Global Services Ltd.
The company placed 2.6 million shares at 435 pence each, saying the placing was significantly oversubscribed and had seen strong demand from institutional investors.
SQS will use the proceeds to partially finance the acquisition of an up to 52.9% share in Thinksoft, for USD17.5 million in cash.
Thinksoft is an India-based software testing company listed on the Bombay Stock Exchange. SQS intends to acquire 24.5% of Thinksoft from its founding shareholders and a further 28.3% through an offer to public shareholders in the company.
The two companies are similar in nature, Chief Financial Officer Rene Gawron told Alliance News, but this acquisition will be complimentary and allow SQS to increase its focus on its largest sector - banking, finance and insurance. Thinksoft primarily operates in these sectors, and has been a competitor over certain European clients for SQS in the past.
"It's always good to buy a competitor," Gawron said.
SQS said that, were it unable to acquire a majority shareholding on the open market, the founders have committed to sell their remaining shares, taking SQS's share to 50.6%. Gawron said it was unlikely that they would not be able to meet the 28.3% required from public shareholders, however.
The company will raise its headcount by around 800 people through the acquisition, Gawron said.
SQS shares were up 6.1% Friday morning at 452.50 pence.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
Copyright © 2013 Alliance News Limited. All Rights Reserved.
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