Perth IT firm in $233m takeover

19/07/2021 - 16:00

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ASX-listed Empired is being acquired by Capgemini Australia, which has offered to pay $1.35 in cash for every share held in the IT firm.

Perth IT firm in $233m takeover
Empired chief executive Russell Baskerville. Photo: Attila Csaszar

ASX-listed Empired is being acquired by Capgemini Australia, which has offered to pay $1.35 in cash for every share held in the IT firm.

Capgemini, an international consulting company headquartered in France, has proposed to acquire all issued shares in Empired via a scheme implementation agreement.

The deal represents almost a 65 per cent premium to Empired’s last closing price of 8.2 cents and values the business at $233 million.

All company directors including chief executive Russell Baskerville intend to vote in favour of the scheme. They represent about 5.8 per cent of Empired’s issued capital.

"Over the past 15 years, Empired has been on a journey to build the most respected digital services company across Australia and New Zealand," Mr Baskerville said.

"Our strategy has delivered material growth in shareholder value and we are confident that being part of Capgemini will help to accelerate our combined market position in the coming years.

"If implemented, the scheme will provide outstanding career opportunities for our people and have a positive impact for existing and prospecting clients by providing them with access to the significant resources, services capabilities and international experience at Capgemini."

The deal remains subject to a number of conditions including shareholder approval, to be sought at a meeting in late September.

Empired’s directors have unanimously recommended shareholders vote in favour of the scheme. 

If implemented, the deal is scheduled to be completed in mid-November.

Shares in Empired closed up 59 per cent today to trade at $1.30, implying a current market capitalisation of about $131.4 million.

The business was founded in Perth in 1999 and acquired Wellington-based Intergen in 2001.

The combined group expects to have generated between $186 million and $188 million in revenue for the full 2021 financial year, compared with $165.5 million in FY20.

Normalised earnings are expected to be between $22 million and $23 million (up from $14.8 million).

Euroz Hartleys is acting as financial adviser to Empired and Clayton Utz as legal adviser in relation to the takeover.

Meanwhile, Luminis Partners is acting as financial adviser to Capgemini and Herbert Smith Freehills as legal adviser.

Capgemini chief executive (Asia Pacific) Olaf Pietschner said enterprises were at a high point in their cloud adoption.

"Capgemini's extensive transformation expertise combined with Empired's strengths as a leader in Microsoft Azure and Dynamics 365 will open up the full power of digital transformation for our clients in Australia and New Zealand, to run their entire business in the cloud and realise value faster," he said.

"We look forward to welcoming Empired's talented professionals to Capgemini."

Capgemini is the second global consulting firm to buy a Perth-based technology business this year.

Earlier this year, Accenture bought privately owned Perth company Electro 80 for a reported $30 million.

Accenture plans to use Electro 80 to help clients digitise their manufacturing, operations and engineering.

Electro 80 has more than 100 people, with offices in Belmont, Brisbane and Melbourne providing automation, electrical, instrumentation, safety, networking, and industrial IT services.

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