Xansa’s communique to the LSE stated, "The Directors of Xansa and Steria are pleased to announce that agreement has been reached on the terms of a recommended proposal whereby Steria will acquire the entire issued and to be issued share capital of Xansa. It is intended that the Acquisition will be implemented by way of a Scheme of Arrangement and, subject to the satisfaction, or, where appropriate, waiver, of the Conditions, it is expected that the Acquisition will become Effective by the end of October 2007."
Under the terms of the acquisition, Xansa shareholders will be entitled to receive 130 pence in cash for each Xansa share. Xansa shareholders on the register on 6 July 2007 will be entitled to receive the 2007 Dividend of 2.16p announced in respect of the financial year ended 30 April 2007, which will be paid on 27 September 2007. Post acquisition Steria is expected to integrate Xansa employees within the Steria workforce.
Commenting on the acquisition, Bill Alexander, Chairman and acting Chief Executive of Xansa, said, "On behalf of the Board of Directors of Xansa, I am pleased to recommend Steria's offer. We are confident that our recommendation is in the best interests of Xansa shareholders and offers an opportunity for our employees to be part of a culturally-aligned, pan-European company able to leverage our integrated onshore/offshore model. The combination of our two businesses will create a leading European IT Services provider able to offer our clients a broader range of market-leading services."
With this acquisition Steria expects to accelerate the implementation of its strategic plan, namely the development of one of the most advanced business models in the European IT Services sector. Commenting on the Acquisition, François Enaud, General Manager and CEO of Steria, said, "This transaction constitutes a major step in the implementation of our strategic plan. Focused on the fastest growing market segments, the new group will be one of the most attractive in the ITS sector, both through the value of its service offerings (Business Transformation and Business Operation) and its exceptional industrial delivery model. I am sure that such an alliance represents an exciting opportunity for all of our employees."
The company looks to strengthen its position in the UK IT Services market, increasing its visibility and aligning its UK business lines including Application and Infrastructure and its UK vertical services lines like Public Sector and Private Sector with those of the Group. The company sees this acquisition as a way to implement one of the most advanced Global Delivery Models incorporating an established, integrated UK-India delivery platform.
“An India-strategy for a global company in the overall business plans takes precedence in its inorganic growth as well. A point highlighted in the acquisition by French IT services company, Groupe Steria of U.K.-based Xansa Plc., which has more 5,000 employees in India out of its total headcount of 8,000. This acquisition also gives Steria the potential to expand in the Asian markets and the much needed muscle to compete with India’s big three IT services companies, Tata Consultancy Services Ltd (TCS), Infosys Technologies Ltd and Wipro Ltd,” said Bundeep Singh Rangar, Chairman, IndusView Advisors, the India-focused cross-border advisory firm.
Post acquisition, Steria is expected to be among the top 10 IT Service providers in both Europe and the UK (by revenue), with a particularly significant presence in the public services and financial services sectors. Its increased scale and reach would also enable it to compete more effectively for business with larger customers.
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