Being acquired wasn’t part of the plan for Alterian when it embarked on a necessary change programme (see Alterian: management overhaul and cost cutting), and subsequent business transformation (Alterian’s active business transformation) but that will be the outcome. Alterian and SDL have reached agreement for SDL to acquire the marketing software company for 110 pence per share, or approximately £68.4m.
The price represents a 73% premium on the pre-offer share price. Alterian’s board and directors recommend that shareholders accept the offer. Alterian’s half-year results earlier this week (see Alterian: 87th day of 100-day transformation programme) showed revenue down 6% to £17.3m. The effects of the cost reduction changes were apparent but it is too early in the transformation to demonstrate clear improvements in other areas.
With SDL owning or having secured assurances for around 64% of the issued share capital, and Alterian recommending the offer, this is pretty much a done deal and if all goes to plan it will close towards the end of January.
Alterian’s campaign management and analytics, and social media marketing solutions will slot neatly into SDL’s information management platform, which includes eCommerce, structured content and language translation capabilities. There is overlap around web content management with both players offering their own solution so some shuffling is expected here. SDL will provide Alterian with more financial stability and a route to more international sales which can only be positive, and the translation capabilities should open new doors.
As for SDL, this deal will make it more of a software player (a space it has not been wholeheartedly engaged in to date due to its interests in language services), but one where it has been making acquisitions (see the HotViews archive). The combined entity will be a bigger and stronger force naturally and the combination of translation capabilities and social media is a potent mix. With both companies being UK-based, it also keeps these assets within the UK tech industry which is a bonus.