Bond International Software plc Acquires Eurowage Limited

Posted: 9th April 2014 08:52

Bond International Software plc, a world leading supplier of staffing, HR and payroll software and services, with operations in the UK, USA, Hong Kong, Japan, China, Singapore and Australia, is pleased to announce the conditional acquisition (the "Acquisition")  of Eurowage Limited ("Eurowage"), which trades as FMP Europe, for a minimum consideration of £8,500,000 (including the value of the consideration shares to be issued as part of the Acquisition)  and further contingent consideration to be based on the financial performance of Eurowage in the three years following completion of the Acquisition.

Eurowage is an international HR & payroll company providing fully managed payroll solutions to organisations in approximately 65 countries around the world.  Their solutions are designed to fit the requirement for a centralised single payroll process that provides coordination of all aspects of setting up employees in a foreign country without the need for a complex group of legalentities.

Eurowage also has a number of strategic commercial partnerships with organisations such as Paychex, a leader in payroll, human resource and benefits outsourcing in the USA, and Western Union, an industry leader in global money transfer.

Eurowage was originally established in 2005 and its headquarters are in Chichester, West Sussex. In the year ended 31 December 2013 Eurowage had unaudited revenues of £3,904,000,unauditedprofit before taxation of £1,784,000 and unauditednet assets of £3,575,000 at 31 December 2013.

The board believe that the Acquisition will be immediately earnings enhancing.
Strategic Rationale:

Bond has seen its payroll operations deliver consistent growth in revenue and profitability over the last few years and is seeking to expand the offering both organically and through acquisition. The payroll operations, which utilise Bond's intellectual property, are currently operating in the UK only. Increasingly, companies with overseas subsidiaries or branches are looking for one payroll provider to meet all their payroll needs. In order to broaden its customer base to multinational companies in the UK and international companies, primarily in the US, the board believes that Bond has to offer payroll solutions in countries other than the UK.

Eurowage provides managed payroll solutions in many countries around the world to customers based in the UK and overseas based customers.  Bond has already partnered with Eurowage on previous deals but the board believes that bringing it into the group will strengthen its product offering and drive sustainable growth in revenues and profits from payroll operations. Furthermore Bond's existing customer base includes organisations with operations in many countries around the world and to whom the group will be well placed to offer international managed payroll solutions through Eurowage.

Bond has the strategic aim to grow recurring revenues. Eurowage typically enters into three year rolling contracts which generate revenues that are recurring by nature, and so is well fitted to the group's current model.

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