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MphasiS to acquire US-based Wyde
MphasiS has signed a definite agreement to acquire 100% equity of US-based insurance
software provider Wyde Corporation in an all-cash deal (as of April 2011, MphasiS had
cash of US$422mn). Wyde is an insurance administration solution provider company and
the creator of insurance platform Wynsure. It caters to all the segments of the insurance
industry – Life and Annuity (L&A), Disability, Health and Property and Casualty (P&C). The
company did not disclose the consideration amount, however generally product companies
are acquired at 2.5–4x sales.
Wyde has annual sales of US$30mn (broad revenue break up – 60% from L&A and 40%
from P&C) with EBITDA margin of 18%. PAT margin of the company is also in the range of
17-18% as it gets aided by other income generated from US$22mn cash in its accounts. It
is a debt-free company. Wyde has 25 clients – 14 in the US, 2 in Canada and 9 in France,
with 50% of its revenue coming from the top five clients. Post acquisition, Wyde, which has
over 200 employees, would operate as a product business of MphasiS. This will aid the
non-linear revenue of MphasiS. The stock is currently under review, though the broad
estimates of the company remain almost unchanged given the relatively small size of the
company acquired.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
MphasiS to acquire US-based Wyde
MphasiS has signed a definite agreement to acquire 100% equity of US-based insurance
software provider Wyde Corporation in an all-cash deal (as of April 2011, MphasiS had
cash of US$422mn). Wyde is an insurance administration solution provider company and
the creator of insurance platform Wynsure. It caters to all the segments of the insurance
industry – Life and Annuity (L&A), Disability, Health and Property and Casualty (P&C). The
company did not disclose the consideration amount, however generally product companies
are acquired at 2.5–4x sales.
Wyde has annual sales of US$30mn (broad revenue break up – 60% from L&A and 40%
from P&C) with EBITDA margin of 18%. PAT margin of the company is also in the range of
17-18% as it gets aided by other income generated from US$22mn cash in its accounts. It
is a debt-free company. Wyde has 25 clients – 14 in the US, 2 in Canada and 9 in France,
with 50% of its revenue coming from the top five clients. Post acquisition, Wyde, which has
over 200 employees, would operate as a product business of MphasiS. This will aid the
non-linear revenue of MphasiS. The stock is currently under review, though the broad
estimates of the company remain almost unchanged given the relatively small size of the
company acquired.
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