Premium valuation exit to global tech corporation
Hopefully, every business gets an opportunity to realise its full potential. For the directors of Edgewing, a takeover approach from a $1bn corporation was just such an opportunity.
Founded in 2002, Edgewing brings together a wide range of skills and expertise from across the Business Intelligence, Data Management and general IT community. They are acknowledged to be the world’s leading Business Objects Data Integrator consultancy and have been recognised by their customers for embodying the highest levels of skills, capability and professionalism.
The Challenge
Edgewing received an unexpected and unsolicited approach from Business Objects, the world’s leading business intelligence software company, and a highly acquisitive US Corporation, with more than 39,000 customers worldwide.
Business Objects wanted to acquire Edgewing because they are recognised as a provider of exceptionally high calibre resources and expertise in a market that Business Objects wanted to dominate.
Edgewing operated in the niche end of a niche market. The Business Objects approach presented an opportunity and a threat. Of all potential suitors Edgewing added most value to Business Objects. Execute the transaction well and the shareholders of Edgewing would make a handsomereturn. Executebadlyand Edgewing could be alienated from the market.
In order for Edgewing to assess the viability of such an acquisition they needed a Financial Director with solid commercial and business acumen to help and advise the Edgewing Board through the process.
As Edgewing did not have a Finance Director they had to find the right one.
Edgewing needed a partner that knew their sector intimately, understood the acquisition process and could combine technical expertise with commercial pragmatism. Isosceles could provide this rare blend of skills.
Mike O’Connell, Managing Director at Isosceles
The Solution
Isosceles, recommended to Edgewing by another Isosceles client, were appointed the lead financial advisor.
The Edgewing management team, who had never sold a company before, needed to ensure they achieved a fair price and that the shape of the deal was right for their employees as well as for themselves.
In particular Isosceles assisted the management by providing advice on:
- Critiquing the business as an independent adviser
- Valuing the company
- Translating the Business Objects’ proposition into understandable commercial terms
- Development and execution of the negotiation strategy
- Sales and Purchase Agreement negotiation
- Co-ordination and liaison with the legal advisors and tax advisors
- Preparation for and guidance through the due diligence process from a finance and accounting perspective.
We identified a number of potential advisors that knew about acquisitions and disposals, but only Isosceles understood our business and were able to articulate clearly enough why we were such a valuable asset to Business Objects.
Clive Bellmore, Founder of Edgewing
The Results
This deal enables the Edgewing management to spread their quality consulting philosophy within a larger organisation and to a much wider customer base.
The results speak for themselves. Business Objects acquired Edgewing on the terms we wanted. When issues arose Isosceles were able to resolve them in a calm and easy manner which left the buyer and seller feeling they were both winning.
Steve Crook, CEO, Edgewing