|By Business Wire||
|April 8, 2014 02:02 AM EDT||
Sopra (NYSE EURONEXT:SOP) and Steria (NYSE EURONEXT:RIA) announced today their intention to create, by carrying out the proposed tie-up, to create a European leader in digital services with a combined revenue of €3.1bn and operations in 24 countries, combining the talents of over 35,000 professionals.
The proposed tie-up will take the form of a friendly, voluntary Offre Publique d’Echange (Public Exchange Offer)1 initiated by Sopra for all of the shares of Steria on the basis of one (1) Sopra share for four (4) Steria shares (the “Offer”). At 4 April 2014, this Offer represented an exchange value of €222 per Steria share on the basis of the weighted average Sopra share price over a one-month period. This represents a 40% premium with respect to the closing share price and a 49% premium with respect to the weighted average share price over the preceding three-month period.
The Board of Directors of Soderi, the associé commandité (general partner) of Steria, as well as the Supervisory Board of Steria and the Board of Directors of Sopra, at their meetings today, approved this proposed tie-up and gave it their support, provided that the transaction remains conditional on the FCPE Groupe Steriactions, which owns 17.45% of the share capital and 20.92% of the voting rights, committing to contribute its shares to Sopra at the latest by 9 April 2014, the completion thereof being itself conditional on the Offer being successful.
Pierre Pasquier, Chairman and founder of Sopra and François Enaud, CEO of Steria, issued the following statement: “Our respective firms share cultures of independence and growth and a great deal of mutual respect. The idea of combining forces has always looked like it made sense. The accelerating pace of the digital revolution and new modes of consuming services are giving rise to a deep-seated change in our market. In this context our tie-up aims to deliver the best transformation solutions to our clients so that they can adapt to the digital world. The alliance between Sopra and Steria would allow us to put together one of the most complete portfolios of offerings available on the market, from software solutions to business process execution. This industrial project would also benefit our employees who would be able to evolve and acquire new skills, and our shareholders would be able to accompany us in a foundational, value-creating project”.
For Jean-Bernard Rampini, Chairman of Soderi: “This tie-up project “between equals” maintains Steria’s human and industrial assets and offers a great, unique opportunity to maintain the values of employee-shareholders within the new group via a new shareholder pact, which was a decisive factor for our support”.
Jacques Bentz, Chairman of Steria’s Supervisory Board and Eric Hayat, Vice-Chairman of the Supervisory Board and co-founder of Steria, added: “We chose to back this offer as it is a tie-up which has been accepted by the general partner and represents a substantial source of potential value creation for employees, clients and shareholders”.
Balanced corporate governance and stable reference shareholder structure
The new group would operate with a balanced corporate governance structure in the framework of a proposed tie-up between equals. Pierre Pasquier would be Chairman of its Board of Directors and François Enaud would be Chief Executive Officer. On the Board of Directors, Sopra and Steria would each be represented by four directors, in addition to independent members and employee representatives.
The share capital of the new combined entity would be structured, on the one hand, around a core block representing the founders and certain managers of Sopra, holding a total of approximately 22% of the share capital, a block owned by Geninfo representing 7% of the share capital, and finally a c.10% block owned by former and current employees-shareholders of Steria. The above-mentioned blocks together represent 39% of the share capital. This shareholder structure would be materialised by a shareholders’ pact between Sopra GMT and Soderi, with the latter representing the former employee-shareholders of Steria.
Very strong complementary fit of business activities and geographic segments
From an industrial perspective, the proposed tie-up between Sopra and Steria is a response to the market changes brought about by the digital revolution and new modes of consuming services. The new group would be able to make the transition from a positioning as “Systems Developer-Integrator” to “Service Creator-Operator”, with a critical mass and the capacity to deliver the best transformation solutions to its clients. The portfolio of offerings would be among the most complete on the market.
The new group would generate 25% of its annual revenue from Solutions and Business Process Services, activities with the highest levels of growth and profitability both for Sopra and Steria. This proportion would develop rapidly, as a result of organic and external growth as well as the synergies related to the tie-up.
In terms of business activities and geographic segments, the complementary fit between the two entities is very strong. Sopra brings the power of its organisation in France, the strength of its banking, human resources and real estate products and its effective application management model. For its part, Steria brings its international reach (Europe and Asia) with a strong positioning in the United Kingdom, a pertinent offering in Business Process Services and its expertise in IT infrastructure management.
Industrial-scale production capacity would be significantly reinforced with an array of offshore and nearshore service centres representing a workforce of approximately 8,000 people, including over 6,000 in India.
A value-creating transaction drawing upon on a strong set of synergies
Reinforcing competitive positioning and the complementary fit of offerings and geographic locations would lead to faster revenue growth. For example, Sopra would be able to benefit from the European positions of Steria to accelerate the commercialisation and rollout of its software solutions; for its part, Steria would be able to leverage Sopra’s offshore capacity in India for its French clients. The proposed tie-up should also generate annual operational cost synergies of €62m commencing in 2017. The transaction is expected to have a neutral effect on basic earnings per share in 2015 and be strongly earnings enhancing as of 2016.
The ambition is to form a group that is capable of generating strong organic growth with the objective of achieving revenue of over €4bn and progressively improve the operating margin on business activity to approach the 10% mark.
Schedule and conditions of the transaction
The Offer will be subject to the customary terms, notably to a success threshold of at least 66.67% of the share capital and voting rights issued by Steria.
Filing of the Offer could take place in May 2014.
Following the information-consultation of the companies’ employee-representing bodies and successful completion of the Offer, a merger of the groups is expected to be carried out.
Presentation and Conference Call
The project will be presented to analysts and investors at a meeting, to be held in French, on Tuesday, 8 April 2014 at 9.30 am at Shangri-La Hotel, 10 avenue d’Iena, Paris.
The presentation will be jointly hosted by Pierre Pasquier, Chairman of Sopra, and François Enaud, CEO of Steria.
This presentation can be followed remotely in French or English. You may register for the webcast or listen to the presentation by dialling +44 203 367 9454.
Sopra’s exclusive financial advisor is Société Générale; its legal advisor is BDGS.
Steria’s exclusive financial advisor is BNP Paribas; its legal advisor is Brandford-Griffith & Associés.
This announcement has been released for informational purposes only and does not constitute and must not be considered as an offer to purchase Groupe Stéria or Sopra shares. The release of this announcement may be restricted by law in certain jurisdictions and, therefore, any person holding this document must enquire about applicable legal restrictions and comply with them. Therefore, Groupe Stéria and Sopra decline all liability whatsoever with regards to the potential violation, by any person, of these restrictions.
1 Sopra and Steria reserve the possibility of completing the tie-up by means of a fusion statutaire merger if necessary.
2 2013 Sopra dividend (€1.90 per share) attached.
@DevOpsSummit at Cloud taking place June 6-8, 2017, at Javits Center, New York City, is co-located with the 20th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long developm...
Apr. 23, 2017 10:30 PM EDT Reads: 1,907
Developers want to create better apps faster. Static clouds are giving way to scalable systems, with dynamic resource allocation and application monitoring. You won't hear that chant from users on any picket line, but helping developers to create better apps faster is the mission of Lee Atchison, principal cloud architect and advocate at New Relic Inc., based in San Francisco. His singular job is to understand and drive the industry in the areas of cloud architecture, microservices, scalability ...
Apr. 23, 2017 10:00 PM EDT Reads: 3,189
Multiple data types are pouring into IoT deployments. Data is coming in small packages as well as enormous files and data streams of many sizes. Widespread use of mobile devices adds to the total. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists will look at the tools and environments that are being put to use in IoT deployments, as well as the team skills a modern enterprise IT shop needs to keep things running, get a handle on all this data, and deli...
Apr. 23, 2017 09:45 PM EDT Reads: 1,920
The age of Digital Disruption is evolving into the next era – Digital Cohesion, an age in which applications securely self-assemble and deliver predictive services that continuously adapt to user behavior. Information from devices, sensors and applications around us will drive services seamlessly across mobile and fixed devices/infrastructure. This evolution is happening now in software defined services and secure networking. Four key drivers – Performance, Economics, Interoperability and Trust ...
Apr. 23, 2017 09:30 PM EDT Reads: 3,526
In recent years, containers have taken the world by storm. Companies of all sizes and industries have realized the massive benefits of containers, such as unprecedented mobility, higher hardware utilization, and increased flexibility and agility; however, many containers today are non-persistent. Containers without persistence miss out on many benefits, and in many cases simply pass the responsibility of persistence onto other infrastructure, adding additional complexity.
Apr. 23, 2017 08:45 PM EDT Reads: 1,985
Bert Loomis was a visionary. This general session will highlight how Bert Loomis and people like him inspire us to build great things with small inventions. In their general session at 19th Cloud Expo, Harold Hannon, Architect at IBM Bluemix, and Michael O'Neill, Strategic Business Development at Nvidia, discussed the accelerating pace of AI development and how IBM Cloud and NVIDIA are partnering to bring AI capabilities to "every day," on-demand. They also reviewed two "free infrastructure" pr...
Apr. 23, 2017 08:45 PM EDT Reads: 655
Cloud Expo, Inc. has announced today that Aruna Ravichandran, vice president of DevOps Product and Solutions Marketing at CA Technologies, has been named co-conference chair of DevOps at Cloud Expo 2017. The @DevOpsSummit at Cloud Expo New York will take place on June 6-8, 2017, at the Javits Center in New York City, New York, and @DevOpsSummit at Cloud Expo Silicon Valley will take place Oct. 31-Nov. 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
Apr. 23, 2017 06:45 PM EDT Reads: 2,293
The explosion of new web/cloud/IoT-based applications and the data they generate are transforming our world right before our eyes. In this rush to adopt these new technologies, organizations are often ignoring fundamental questions concerning who owns the data and failing to ask for permission to conduct invasive surveillance of their customers. Organizations that are not transparent about how their systems gather data telemetry without offering shared data ownership risk product rejection, regu...
Apr. 23, 2017 05:30 PM EDT Reads: 913
Most companies are adopting or evaluating container technology - Docker in particular - to speed up application deployment, drive down cost, ease management and make application delivery more flexible overall. As with most new architectures, this dream takes a lot of work to become a reality. Even when you do get your application componentized enough and packaged properly, there are still challenges for DevOps teams to making the shift to continuous delivery and achieving that reduction in cost ...
Apr. 23, 2017 05:30 PM EDT Reads: 3,592
Translating agile methodology into real-world best practices within the modern software factory has driven widespread DevOps adoption, yet much work remains to expand workflows and tooling across the enterprise. As models evolve from pockets of experimentation into wholescale organizational reinvention, practitioners find themselves challenged to incorporate the culture and architecture necessary to support DevOps at scale. In his session at @DevOpsSummit at 20th Cloud Expo, Anand Akela, Senior...
Apr. 23, 2017 05:15 PM EDT Reads: 1,496
In his keynote at 19th Cloud Expo, Sheng Liang, co-founder and CEO of Rancher Labs, discussed the technological advances and new business opportunities created by the rapid adoption of containers. With the success of Amazon Web Services (AWS) and various open source technologies used to build private clouds, cloud computing has become an essential component of IT strategy. However, users continue to face challenges in implementing clouds, as older technologies evolve and newer ones like Docker c...
Apr. 23, 2017 03:30 PM EDT Reads: 2,438
SYS-CON Events announced today that Twistlock, the leading provider of cloud container security solutions, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Twistlock is the industry's first enterprise security suite for container security. Twistlock's technology addresses risks on the host and within the application of the container, enabling enterprises to consistently enforce security policies, monitor...
Apr. 23, 2017 03:30 PM EDT Reads: 3,280
The Internet of Things is clearly many things: data collection and analytics, wearables, Smart Grids and Smart Cities, the Industrial Internet, and more. Cool platforms like Arduino, Raspberry Pi, Intel's Galileo and Edison, and a diverse world of sensors are making the IoT a great toy box for developers in all these areas. In this Power Panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists discussed what things are the most important, which will have the most profound e...
Apr. 23, 2017 03:30 PM EDT Reads: 1,932
Automation is enabling enterprises to design, deploy, and manage more complex, hybrid cloud environments. Yet the people who manage these environments must be trained in and understanding these environments better than ever before. A new era of analytics and cognitive computing is adding intelligence, but also more complexity, to these cloud environments. How smart is your cloud? How smart should it be? In this power panel at 20th Cloud Expo, moderated by Conference Chair Roger Strukhoff, pane...
Apr. 23, 2017 03:15 PM EDT Reads: 1,872
The goal of Continuous Testing is to shift testing left to find defects earlier and release software faster. This can be achieved by integrating a set of open source functional and performance testing tools in the early stages of your software delivery lifecycle. There is one process that binds all application delivery stages together into one well-orchestrated machine: Continuous Testing. Continuous Testing is the conveyor belt between the Software Factory and production stages. Artifacts are ...
Apr. 23, 2017 03:15 PM EDT Reads: 798