Constellation Software Inc. Reaches Agreement to combine its TSS Operating Group With Topicus.com to form a new Operating Gro...
May 20 2020 - 7:25AM
Constellation Software Inc. (“Constellation”) (TSX:CSU) announced
today that it has, acting through its TSS operating group and its
subsidiary TPCS Holding B.V. (the “Purchaser”), entered into a
binding agreement with IJssel B.V. (the “Seller”) to purchase 100%
of the shares of Topicus.com B.V. (“Topicus”), a Netherlands-based
diversified vertical market software provider.
Once the transaction is completed, TSS and Topicus will operate
together under the operating group name “Topicus.com”. Under the
guidance of Constellation, Topicus.com intends to explore
opportunities for a future public listing of its shares.
Pursuant to such listing, it is anticipated that Constellation
would remain a significant shareholder of Topicus.com, and that the
current Constellation shareholders would be entitled to receive,
pro rata and via dividend, common shares in Topicus.com.
The purchase of Topicus will be financed with TSS’ cash on hand
and its existing revolving line of credit and requires no funding
from Constellation. Consideration will be in the form of a
cash payment plus the issuance to the Seller of approximately 9% of
the shares of the new operating group Topicus.com (the merged TSS
and Topicus economic entity). Annual gross revenues of
Topicus for 2019 were approximately €101M and total tangible assets
at December 31, 2019 were approximately €7M. Topicus employs
approximately 1,000 employees (870 full time
equivalents). The transaction is currently expected to
close in 2020, subject to the satisfaction of certain standard
closing conditions including clearance from the Dutch Competition
Authority.
“We have been following the impressive development of Topicus
since its beginning in 2001. The company has been growing through
acquisitions, but predominantly organically. Its portfolio is not
directly competitive with ours. Both companies will operate
stand-alone in our decentralized organization model,” said Robin
van Poelje, CEO of TSS.
Daan Dijkhuizen, CEO of Topicus, commented: “We see TSS as the
designated partner to realize our further growth ambitions in
Europe. The intended collaboration contains a wealth of opportunity
for our team members, customers and product offerings. Both
Topicus and TSS have a strong culture of entrepreneurship and
proven craftsmanship combined with great focus. The mutual
complement lies in the bundling of knowledge of and experience in
healthy business operations, effective and customer-oriented
services in combination with innovative strength.”
Mark Leonard, President of Constellation, said: “I cannot think
of another vertical market software company that has achieved
Topicus' size without using outside shareholder funding. I
look forward to spending more time with the Topicus founders as
travel becomes easier. I'm an old dog, but I'm certain that
they have new tricks to teach me. More importantly, they have
experience and practices that can benefit all of the Constellation
operating groups.
The plan to create a publicly listed operating group made up of
Topicus and TSS was a key part of our discussions with the Topicus
founders. They didn't want their legacy disappearing into the craw
of an omnivorous conglomerate. While they knew that Topicus
would have autonomy within Constellation, they also wanted
identity. The public listing is expected to afford our
Netherlands-based businesses a platform from which to celebrate
their culture and achievements.
I look forward to having CSI's long-term shareholders become
long-term shareholders of Topicus.com.”
Forward Looking Statements Certain statements
herein may be “forward looking” statements that involve known and
unknown risks, uncertainties and other factors that may cause the
actual events to be materially different from any future events
expressed or implied by such forward-looking statements. Words such
as “may”, “will”, “expect”, “believe”, “plan”, “intend”, “should”,
“anticipate” and other similar terminology are intended to identify
forward looking statements. Forward looking statements in this
press release include, but are not limited to, the intention of
Topicus.com to explore opportunities for a future public listing of
its shares, and the intention to have Constellation and its current
shareholders become shareholders of Topicus.com. Such forward
looking statements involve significant risks and uncertainties,
should not be read as guarantees of future results, and will not
necessarily be accurate indications of whether or not such results
will be achieved, or when such results will be achieved. A number
of factors could cause actual results to vary significantly from
the results discussed in the forward looking statements. These
forward looking statements reflect current assumptions and
expectations regarding future events and are made as of the date
hereof and Constellation assumes no obligation, except as required
by law, to update any forward looking statements to reflect new
events or circumstances.
About Total Specific
Solutions
TSS is one of CSI’s six Operating Group companies, based in the
Netherlands and solely focused on the European vertical market
software industry.
About Topicus
Topicus is a Netherlands based leader in building and running
smart vertical market software since 2001. Their focus is on
innovation through vertical market integration. Topicus connects
organizations, professionals and end users within and across the
vertical markets of education, healthcare, municipalities and
financial services.
About Constellation Software
Inc.
Constellation acquires, manages and builds
vertical market software businesses that provide mission-critical
software solutions.
For further information, contact:
Constellation Software
Inc.Jamal Baksh, Chief Financial OfficerTel: (416)
861-2279jbaksh@csisoftware.comwww.csisoftware.com
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