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DELPHI ANNOUNCES THE ACQUISITION OF REDSHAW INC.; THE COMPANY'S SECOND THIS YEAR

 DELPHI ANNOUNCES THE ACQUISITION OF REDSHAW INC.;
 THE COMPANY'S SECOND THIS YEAR
 WESTLAKE VILLAGE, Calif. Dec. 16 /PRNewswire/ -- Delphi Information Systems Inc. (NASDAQ: DLPH) announced today the acquisition of all the outstanding shares of Redshaw Inc., a subsidiary of the ITT Hartford Fire Insurance Group. Other selling minority shareholders of Redshaw include Crum & Forster Insurance Co., Kemper National Insurance Co., and St. Paul Fire and Marine Insurance Co. The acquisition of Redshaw is the second acquisition by Delphi within the last ten months and increases Delphi's revenues nearly three times in that period. In February, 1991, Delphi acquired and merged with McCracken Computer Inc. The combined reported revenues of Delphi, McCracken and Redshaw for the year ended March 31, 1991 would have totaled over $60 million.
 Redshaw is one of the largest suppliers of software and automation systems and services for independent property and casualty insurance agencies and brokerages in North America with its software operating on over 31,000 workstations and terminals installed at over 3,200 customer sites. Redshaw reported revenues of $18 million for the 12 months ended March 31, 1991, and $7 million for the seasonally slow six months ended Sept. 30, 1991. Redshaw has reported net profits for the last four quarters before interest charges by Hartford for debt and other Hartford corporate charges which are eliminated subsequent to the acquisition. Redshaw markets its products and services in the United States and Canada and has 150 employees at its Pittsburgh headquarters and Toronto offices. Delphi will employ 380 people immediately subsequent to the combination.
 Delphi acquired Redshaw for $2 million in cash (after netting a payment under a service agreement), 282,646 shares of Delphi Common Stock, 31,950 shares of Delphi Series B Preferred Stock including three years of unearned stock dividends, and $3 million principal amount of subordinated notes which are non-interest-bearing prior to their three-year maturity. The subordinated notes will be converted into an additional 30,000 shares of Series B Preferred if such conversion is approved by Delphi shareholders at their next annual meeting. Assuming such approval, the 61,950 shares of Series B Preferred would be convertible at the holders' option after three years into a maximum of 1,032,500 additional shares of Common Stock and automatically will convert after four years.
 The exchange rate for conversion of the Series B Preferred Stock into Common Stock is equal to the trading value of Delphi Common Stock at the conversion date. Using the closing trading value on acquisition date and assuming conversion of the subordinated notes, the 61,950 shares of Series B Preferred would be converted into 750,000 Common Shares on that date.
 Delphi will account for the acquisition as a purchase and expects goodwill of approximately $4 million resulting from the acquisition. The calculation of goodwill includes recording the Delphi securities exchanged in the transaction at their fair market value rather than nominal value. Delphi plans to consolidate certain operations of Redshaw into Delphi and eliminate redundancies which is expected to more than offset the costs of amortizing the goodwill.
 Richard Janssen, chairman of the board of Delphi, stated, "The addition of Redshaw further strengthens our position as the premier provider of software and automation systems and services to independent property and casualty insurance agencies and brokerages. Our customers now include 80 percent of the top 25 agencies and brokerages in North America and over 64,000 terminals and workstations representing close to 50 percent of all workstations installed in independent agencies and brokerages.
 William Harrison, senior vice president of ITT Hartford and chairman of Redshaw, stated, "The combination with Delphi will ultimately allow Redshaw customers to take advantage of new innovative products and services which Redshaw would not be able to develop on its own. Delphi's extensive knowledge in automating some of the most sophisticated brokers will complement Redshaw's expertise."
 Frank Grebowski, president of Redshaw, added, "This combination will create great benefits for our customers, as both organizations have a strong customer service emphasis. I am excited about our future potential."
 Headquartered in Westlake Village, Delphi is the leading vendor of automation systems and services for independent property and casualty insurance agencies and brokers in North America. The company develops, markets and supports computer applications software systems which automate independent agencies and brokers encompassing the areas of sales management, policy and claims administration, accounting, financial reporting and electronic interface with the computers of insurance carriers. The company also markets and supports the hardware necessary to operate its proprietary software systems.
 -0- 12/16/91
 /CONTACT: Terance A. Kinninger, VP and CFO of Delphi Informations Systems Inc., 818-706-8989/
 (DLPH) CO: Delphi Information Systems Inc. ST: California IN: SU:


EH-DM -- LA013 -- 2654 12/16/91 16:30 EST
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Publication:PR Newswire
Date:Dec 16, 1991
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