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November 25, 1991

JUST WHO IS THE KINDLE GROUP AND WHY DID ACT GROUP BUY IT?

By CBR Staff Writer

It took just over three months for ACT Group Plc to wrap up its acquisition of Dublin-based Kindle Group Ltd (CI No 1,804). On top of the UKP28.7m price tag, ACT will be keeping an eye on Kindle’s profits until its June 30 year-end, when ACT will pay a further UKP5.5m depending on Kindle’s performance. A spokesman for ACT expressed confidence in Kindle to achieve profit targets and said that the two-stage price served as an incentive. Kindle’s Fin Murray said that the price reflected the success of the company and that the deferred payment made good business sense. Both sides are quick to spot the benefits of the deal. Kindle needed a large organisation behind it to expand and ACT is hungry for Kindle’s far-flung customer base as well as its wholesale and retail banking applications. 80% of Kindle’s business comes from outside Ireland and the UK. An international breakdown of Kindle’s sales to the 1991 year-end reveals that Ireland and the UK accounted for 27%, Asia Pacific for 16%, Africa 13%, Central Asia and Western Europe 10%, the Middle East 9% and North America 5%. Kindle has relied on three sales channels to build up business in these 58 countries: distributors, direct sales and hardware vendors. Business has spread through this network, says Murray, citing the example of a distributor in Hungary that led to business in Poland, Bulgaria and Czechoslovakia. Its Bankmaster product, a back office, 22 module, multi-currency accounting and management information system, together with its branch automation system, Branchpower, are based on open systems. Murray says that this is the key to their success as the whole world is moving in this direction. The acquisition follows ACT’s takeover of Quotient Systems in May. A spokesman for ACT says that ACT remains interested in the acquisition of companies with complementary financial sector products and services. He pointed out that ACT has been acquiring software service companies since 1986, with four companies being bought in the last 18 months. He added that ACT Medisys and ACT Logsys were also looking for acquisitions.

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