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CA buys Austrian peer in $635m deal

By Reuters
United States, 02 Dec 2016

US software management group CA said yesterday it has agreed to buy Austrian business automation firm Automic from private equity group EQT in a EUR600 million ($635 million) deal as it seeks to expand in Europe.

Automic specialises in helping developers of some of the most complex business applications to roll out new releases of software at companies such as Bosch, Netflix, eBay, Exxon Mobil, Vodafone, Soci'et'e G'en'erale, General Electric and Swisscom.

It aims to post earnings before interest, taxes, depreciation and amortisation of EUR44 million in its fiscal year ending in April 2017, on sales of EUR142 million.

The deal values Automic at 13.6 times its expected core earnings, while CA trades at 7.5 times.

Buyout group EQT acquired the company in 2012 for EUR210 million and made 3.2 times its money as measured by its internal rate of return of more than 30%.

At the time of EQT's acquisition of Automic, the company made EUR65 million in sales and was very focused on its clients in the German-speaking world.

EQT brought in a new management team, bought the largest European peer Orsyp and invested in the US sales force.

The buyout group had launched an auction with the help of investment banks Arma Partners, Goldman Sachs and attracted suitors including buyout group Advent.

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