Sage buys into Spain.
Software giant Sage has continued a push into southern Europe with the pounds 49.1m purchase of a Spanish accounting software company.
And buying Grupo SP has brought the fast-growing Newcastle-based accountancy software group more than 200,000 new customers.
Sage chief executive Paul Walker said: "The acquisition extends our geographical presence to the strategically important Spanish market in which SP is well established.
"Its leading product brands and sizeable customer base provide a sound platform from which we can develop our presence in Spain.
"The acquisition is a significant step forward in our strategy of expanding into attractive new markets where Sage's business model and expertise can add value."
The deal continues an advance south through Europe for Sage, which acquired French software specialist Concept Group of Paris for pounds 6.5m in January this year.
It has also bought American business management software supplier Timberline for pounds 63.9m and South African- based SME and accountancy software maker Softline for pounds 66m. SP - which will add pounds 22.8m a year to Sage sales - specialises in providing accounting software for SMEs in its home market.
Sage plans to retain the SP brand, but develop the business through the introduction of advanced accounting applications and customer relationship software.
Sage head of investor relations Phil Branston said: "We believe a number of the 200,000 customers will be growing businesses with an interest in moving up to more advanced software."
SP - which employs 470 people and posted profits of pounds 4.4m last year - was acquired for an enterprise value of pounds 49.1m. The business also brings Sage net cash of pounds 6.6m to give an equity value of pounds 55.7m. The deal excludes the South American operations of Grupo SP.
Mr Branston said: "Spain has been of interest for a while, because it has a lot of small businesses and we found a business with which we can add a lot of value. We have said for a long time that we are interested in southern Europe.
"Acquiring a business with an existing brand and customer base means we do not have to establish a brand from scratch. SP will remain in the market place because our strategy is to keep local brands."
But Sage's share price - along with the rest of the tech sector's - dropped yesterday following software maker Microsoft's statement on Thursday that the market was rocky. Sage's share price fell 1.5pc to 170.25p.
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|Title Annotation:||Business Local|
|Publication:||The Journal (Newcastle, England)|
|Date:||Oct 25, 2003|
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