IQGeo Group PLC on Friday said it plans to raise £3.5 million to partially fund its acquisition of Comsof NV.
IQGeo is a Cambridge-based geospatial productivity and collaboration software company focused on the telecoms and utility industries.
The company has bought Comsof for up to €13 million, consisting of just shy of €8.9 million in cash and just under £1.2 million in shares.
Comsof is a Ghent, Belgium-based company that builds and licenses fibre optic network planning and design software.
IQGeo said that the acquisition will provide a customer base in the European telecommunications market and will create a continental European operations hub for the company from its main office in Ghent.
In the 12 months to April 30, Comsof reported revenue of €7.0 million, including recurring revenue of around 25%, and earnings before interest, tax, depreciation and amortisation of approximately €1.3 million.
IQGeo expects the acquisition to be earnings enhancing in its first full year of ownership.
To help fund the acquisition, IQGeo announced a placing to raise around £3.5 million, at a price of 125 pence per share. This represents a 0.6% discount to the share’s closing price of 125.80p on Thursday, being the last business day before the announcement
IQGeo shares are currently up 3.8% to 129.00 pence each in London on Friday midday.
A number of IQGeo directors intend to participate in the placing, contributing around £400,000, the company said.
The placing is being conducted through an accelerated bookbuild, undertaken by finnCap Ltd.
Chief Executive Officer Richard Petti said: ‘There is very significant demand for fibre planning and design solutions globally and the acquisition of Comsof allows us to satisfy this demand with a world class product.
‘In addition to accelerating IQGeo telecoms software sales, Comsof has a significant European customer base and its headquarters in Ghent will act as a European hub for the combined business presenting further expansion opportunities for IQGeo,’ Petti added.
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