Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON
  1. Homepage
  2. Equities
  3. United Kingdom
  4. London Stock Exchange
  5. Sage Group plc
  6. News
  7. Summary
    SGE   GB00B8C3BL03

SAGE GROUP PLC

(SGE)
  Report
Delayed Quote. Delayed London Stock Exchange - 06/18 11:35:24 am
677 GBX   -1.14%
04:41pSAGEá : 7 business growth challenges to anticipate and overcome
PU
11:47aSAGE BOOK CLUB : #ForwardToFreedom books to celebrate Juneteenth
PU
11:27aSAGEá : Understanding profit margins for restaurants
PU
SummaryQuotesChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector news

Sage : announces the acquisition of Intacct

07/25/2017 | 12:10pm EDT

25th July 2017

Sage announces the acquisition of Intacct, a leading North American provider of cloud Financial Management Solutions

The Sage Group plc ('Sage'), announces that it has agreed to acquire Intacct Corporation ('Intacct'), a leading provider of cloud Financial Management Solutions in North America. The total consideration is $850m (£654m) to be paid in cash and rolled over Sage options.

Intacct is headquartered in San Jose, California, and serves thousands of businesses in the North American scale-up and enterprise markets, both directly and through a network of partners. Intacct provides sophisticated and powerful cloud Financial Management Solutions targeted at growing businesses looking for rich financial and operational insight, process automation, seamless integration with their existing software, advanced features and a modern user experience.

The company has a three-year revenue CAGR in excess of 33%, with current annualised recurring revenues of $96m (£74m) and revenues in the twelve months to June 2017 of $88m (£68m), over 90% of which is subscription based. Intacct was recently named a Visionary by Gartner in its inaugural Magic Quadrant for Cloud Financial Management Suites for Mid-Size, Large and Global Enterprises (June 2017).

Intacct's CEO, Robert Reid, leads an experienced management team with a demonstrated track record of scaling at pace, who will remain to run the business, thereby ensuring continuity for customers, partners and employees.

Sage management reconfirms current guidance as detailed in Sage's Q3 trading update for the full year of at least 6% organic revenue growth including the contribution from North American Payments through to completion of the disposal and an underlying operating margin of at least 27%. For the avoidance of doubt the underlying operating margin guidance includes any investments in Sage Intacct, Sage People and Compass.

In addition to organic revenue we expect Intacct (to be known as Sage Intacct after completion), Sage People (Fairsail) and Compass to add approximately £20m of revenue in this financial year. Following completion of the transaction, the pro-forma net debt to EBITDA leverage ratio will remain in the previously communicated range of 1 - 2x.

The transaction is expected to complete within weeks, subject to customary completion conditions.

Strategic Rationale

The acquisition demonstrates Sage's strong affirmation to winning in the cloud, winning in the US and accelerates the strategy underpinned by Sage's five strategic pillars.

As customer demand moves to the cloud and away from traditional monolithic ERP suites, the acquisition strengthens Sage's position as providing the first and last cloud Financial Management Solution a customer will ever need from start-up to global enterprise, whilst integrating seamlessly with their other enterprise applications. Sage partners will now be able to grow their own businesses fully in the cloud with Sage. In the short term it provides Sage further platform for growth, with medium term aspirations for geographical expansion.

Finally, the combination of Sage and Intacct's existing product portfolio, brand, resources and partners, will put Sage in prime position to establish itself as the leading provider of cloud Financial Management Solutions in North America in our chosen segments.

Commenting on the acquisition, Stephen Kelly, CEO of Sage, said:

'Today we take another major step forward in delivering our strategy and we are thrilled to welcome Intacct into the Sage family. The acquisition of Intacct supports our ambitions for accelerating growth by winning new customers at scale and builds on our other cloud-first acquisitions, strengthening the Sage Business Cloud. Intacct opens up huge opportunities in the North American market, representing over half of our total addressable market.'

Robert Reid, CEO of Intacct, added:

'We are excited to become part of Sage because we are relentlessly focussed on the same goal - to deliver the most innovative cloud solutions for our customers. Intacct is growing rapidly in our market and we are proud to be a recognised customer satisfaction leader across Midsize, Large and Global Enterprise businesses. By combining our strengths with those of Sage, we can jointly accelerate success for our customers.'
Evercore acted as financial advisor to Sage. Sage also received financial and corporate broking advice from Citigroup Global Markets Limited. Skadden, Arps, Slate, Meagher & Flom LLP served as legal advisor to Sage.
Morgan Stanley & Co. LLC. acted as financial advisor and Fenwick & West LLP served as legal advisor to Intacct.

This announcement contains inside information. The person responsible for arranging for the release of this announcement on behalf of Sage is Lauren Wholley.

Conference Call and presentation:

Stephen Kelly, CEO and Steve Hare, CFO, will be hosting a conference call at 17:30 BST today covering both the Q3 results and the acquisition of Intacct, which will be webcast from a link on our investor relations website, www.sage.com/investors. The call may also be accessed using the dial-in number +44 (0) 20 3427 1900, pin code 7387826#. A replay of the call will also be available for one week after the event: dial in number +44 (0) 20 3427 0598, pin 7387826#

A short presentation will be available on Sage's website: www.sage.com/investors/investor-downloads - select the Presentations tab.

Enquiries:

The Sage Group plc +44 (0) 191 294 3457
Lauren Wholley, Investor Relations Director
Amy Lawson, VP Communications

FTI Consulting +44 (0) 20 3727 1000
Charles Palmer
Dwight Burden

Exchange rate of £1.00 / $1.30 is used throughout this statement.

Approximately $43m of the transaction value (this being a fixed amount based on the difference between value per underlying share of Intacct common stock, the number of unvested options and the aggregate exercise prices of the rolled-over options) due to unvested options to purchase shares of Intacct common stock held by management and employees, will be rolled over into options to purchase Sage shares at a fixed exchange ratio based on Sage's share price in the period prior to completion. Vesting will be conditioned on continued employment. Key members of the Intacct executive management are rolling a minimum of 25% of their proceeds into new Sage options, vesting in 12 months assuming continued employment - in addition to other retention incentives being provided.

Intacct's revenue for the year ended 30 June 2016 was $67m / £52m with loss before tax of $23m / £18m and gross assets as at 30 June 2016 of $36m / £28m.

Scale-up is defined as businesses of 10-200 employees, enterprise is defined as businesses of 200-2,000+ employees.

3-year compound annual growth of total revenues to June 2017 (unaudited). Revenues are normalised for impact of one-off deferred revenue release resulting from renewal of a significant ISV relationship. Including this deferred revenue release revenues for LTM June 2017 are $93m. Excluding these normalisations, 3-year revenue CAGR would be 37%.

As of June 2017, unaudited.

See footnote 5 re: normalisation adjustment.

Excluding any purchase price accounting adjustments, in particular fair value adjustments to deferred revenue upon acquisition.

Sage Group plc published this content on 25 July 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 25 July 2017 16:10:09 UTC.


ę Publicnow 2017
All news about SAGE GROUP PLC
04:41pSAGEá : 7 business growth challenges to anticipate and overcome
PU
11:47aSAGE BOOK CLUB : #ForwardToFreedom books to celebrate Juneteenth
PU
11:27aSAGEá : Understanding profit margins for restaurants
PU
11:27aSAGEá : How to start an ecommerce business and website
PU
06/17SAGEá : Ready to grow your ecommerce business? Understanding these accounting ba..
PU
06/17VOLUNTARY VAT : Here's what HMRC's April 2022 mandatory Making Tax Digital requi..
PU
06/17SAGEá : Manchester Metropolitan University chooses Sage as learning partner for ..
PU
06/17SAGEá : What is the difference between job costing and process costing?
PU
06/16THE POWER OF DATA : 5 ways to make sure you get business decisions right
PU
06/15SAGEá : Key policies and procedures employers and businesses should have in plac..
PU
More news
Financials
Sales 2021 1 851 M 2 559 M 2 559 M
Net income 2021 257 M 355 M 355 M
Net Debt 2021 62,2 M 86,0 M 86,0 M
P/E ratio 2021 30,1x
Yield 2021 2,57%
Capitalization 7 235 M 9 983 M 10 004 M
EV / Sales 2021 3,94x
EV / Sales 2022 3,72x
Nbr of Employees 11 647
Free-Float 96,7%
Chart SAGE GROUP PLC
Duration : Period :
Sage Group plc Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends SAGE GROUP PLC
Short TermMid-TermLong Term
TrendsBullishBullishNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 22
Average target price 665,11 GBX
Last Close Price 684,80 GBX
Spread / Highest target 18,3%
Spread / Average Target -2,88%
Spread / Lowest Target -24,1%
EPS Revisions
Managers and Directors
NameTitle
Steve Hare Chief Executive Officer & Director
Jonathan Anton George Howell Chief Financial Officer & Executive Director
Donald Hood Brydon Chairman
Aaron Harris Chief Technology Officer
Lee Perkins Chief Operating Officer
Sector and Competitors
1st jan.Capitalization (M$)
SAGE GROUP PLC17.66%10 198
ORACLE CORPORATION19.89%223 647
SAP SE11.32%167 752
INTUIT INC.23.56%129 724
SERVICENOW, INC.-3.64%104 726
DOCUSIGN, INC.17.23%50 776