Ciber said it has already received acceptances from investors holding a total of 63.6% of ECSoft’s outstanding shares, including former president and CEO Terje Laugerud who owns 0.9% of the company, and outside investors owning 41%. Ciber said this would enable it to avoid being outbid by an outside competitive offer.

ECSoft will provide Ciber with additional revenue of 59.3m pounds ($84.2m) based on its revenue in 2001, from a workforce of around 600 people in Sweden, Denmark, Norway, the Netherlands and the UK. The company specializes in providing IT consulting and systems integration services to the financial services, telecoms and public sectors and counts Astra Zeneca, Iceland, Bradford & Bingley, Bristol & West, Unisys, Ericsson, Scottish Police, Ministry of Defense, London Borough of Greenwich, and Eurocontrol among its customers.

Last month, ECSoft announced it was in discussions to either sell or merge ECSoft after Ciber acquired an initial 8.8% stake in the company. The company reported that it had been informed by Ciber that it had acquired 895,667 shares in ECSoft at up to 175 pence ($2.77) per share. Since then in early December Laugerud was hired as a consultant at Ciber to help define and drive the growth of Ciber’s European operations.

Ciber plans to pool ECSoft into Ciber UK within its European operation Ciber Solutions Partners which has offices in Germany, the Netherlands and Hungary. The deal represents an 82% premium on ECSoft’s closing price of 167.5 pence on November 21, the day prior to the company announcing that it was in discussions over a possible takeover. Part of the reason for the value is the fact that ECSoft is sitting on a healthy cash pile, which stood at 27m pounds ($42.7m) on October 31 2002.

ECSoft has spent the past 18 months refocusing its ailing business including the sale of its managed services business to Dutch outsourcing firm PinkRoccade in 2001, as well as the acquisitions of two operations in the Nordic market including Bitcraft AB and S17, a division of Swedish web integrator Framfab. Most recently in 2002, ECSoft acquired Dutch Oracle consulting firm BTS Consulting BV for 1.5m euros ($1.46m) as well as the Danish IT services operation of CMG Plc.

However, the deals have failed to curb ECSoft’s declining trading performance, and during the six months ending December 31, 2002, Ciber expects ECSoft to report an operating loss of 6.6m pounds ($10.1m), including goodwill amortization and restructuring, although prior to any impairment charges.

This is the second acquisitive step Ciber has made into Europe. In December 2001, it paid $31.4m in cash and shares for beleaguered Bellevue, Washington-based Aris, an e-business consulting and CRM integrator with a strong UK presence, which made full year 2000 sales of $63.7m. But the company has not stopped there. In April 2002, it bought Southfield, Michigan-based Decision Consultants Inc, which is one of the largest privately-owned IT services providers in the US with full-year 2001 revenue of $120m.

Source: Computerwire