Ideagen, the UK-based and recently AIM-listed provider of on-demand information management and compliance software, is expanding the compliance side of its business with the proposed acquisition of Proquis.
Ideagen is paying £1.04m up front in cash and shares and there is potential for an additional sum of up to £2.2m. Proquis specialises in compliance and quality management software for highly regulated industries, provided in the form of a web-based platform.
It is a small operation – revenue for the year ending September 30 2011 was £758,000 and profit before tax was £152,000. But it does have a very obvious attraction: last month it signed a contract with the US Government Department of Veterans Affairs expected to be worth approximately $10.6m over 5 years. With that in the background, it is not surprising that Ideagen says the acquisition is expected to be immediately earnings enhancing. Ideagen posted revenue of c£2.25m in the last fiscal year.
We’re not overly familiar with Ideagen but our impression is that the business has two distinct parts – compliance and content management (see Ideagen braves the document management and compliance markets). It would be good to see them in closer alignment as compliance applied to content management has real value and could differentiate Ideagen from enterprise content management competitors.