Microgen PLC Acquisition of RevStream (3757P)
August 31 2017 - 2:01AM
UK Regulatory
TIDMMCGN
RNS Number : 3757P
Microgen PLC
31 August 2017
microgen
www.microgen.com 31 August 2017
ACQUISITION OF REVSTREAM INC.
Microgen plc ('Microgen') is pleased to announce the acquisition
of RevStream Inc. ('RevStream'), a California-based provider of
revenue management enterprise software. The acquisition broadens
and complements the specialist capabilities within Microgen's
Aptitude Software business ('Aptitude') and provides access to
RevStream's growing client base in the technology sector.
RevStream will be integrated into Aptitude which already has an
established office in Boston and a strong North American presence
with over 50% of H1 2017 Aptitude revenues generated in the US and
Canada.
Since 2015 Aptitude has established a market leading position in
the telecommunications sector with the Aptitude Revenue Recognition
Engine ('ARRE'), an application which enables organisations to
address the requirements of IFRS 15 and ASC 606. ARRE has
established this strong position as a result of its capability to
process very rapidly a very high volume of complex, business
event-driven transactions and calculations. The acquisition of
RevStream enables Aptitude to offer broader revenue management
functionality which augments the specialised capabilities of
ARRE.
RevStream's growing client base, primarily focussed on the
technology sector, complements Aptitude's strong presence within
the financial services, insurance and telecommunications sectors
and provides cross-selling opportunities for both organisations'
products. In addition, RevStream's existing cloud capabilities will
be leveraged across Aptitude's new applications where cloud
deployment is appropriate.
Consideration for the entire issued and to be issued shares of
RevStream is GBP9.7 million. In addition, at completion RevStream
had debt and debt-like items of GBP2.5 million which Microgen will
settle under its ownership. Of the consideration of GBP9.7 million,
GBP7.7 million is expected to be payable in cash of which
approximately 70% was paid on completion with the remaining 30%
payable across the following two-year period. The initial cash
consideration was satisfied using Microgen's existing cash
resources. The consideration of GBP9.7 million also includes
421,582 Microgen shares (valued at GBP2.0 million as at 30 August
2017) which will be issued in August 2019. The founder, CEO and
former majority shareholder of RevStream, Rajiv Chopra, will remain
with the business.
RevStream has experienced a significant increase in demand for
its products and services in 2017. RevStream's on-going recurring
revenue base is currently GBP2.9 million, an increase of 58% since
31 December 2016, with a number of further opportunities well
progressed. RevStream's revenue in the year ended 31 December 2016
was GBP2.7 million; this is expected to more than double in 2017.
RevStream reported a loss before tax in 2016 of GBP0.8 million. The
gross assets at 31 December 2016 were GBP0.9 million. The
acquisition of RevStream is anticipated to be earnings enhancing in
2018.
Contacts
Philip Wood, Chief Financial Officer 020-7496-8100
James Melville-Ross / Darius Alexander 020-3727-1000
FTI Consulting
This information is provided by RNS
The company news service from the London Stock Exchange
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