Blue Phoenix Solutions Ltd. (Nasdaq: BPHX; TASE: BPHX) today announced that it is about to complete the acquisition of specific assets and activities of CodeStream Software Ltd., a private UK company formerly known as Xitec Software Ltd., for ₤5.2 million ($10 million). BluePhoenix will also pay ₤3.4 million ($6.6 million) in form of convertible bonds upon the completion of certain business milestones, predominately related to the successful implementation of CodeStream's technology at a large-scale customer within the next 24 months.
BluePhoenix CEO Arik Kilman said, “This strategic acquisition gives us a huge edge over other solutions in the field.” The company develops and markets software tools and services for enterprise IT modernization.
CodeStream was founded in 1996 and specializes in the modernization of legacy databases. The company has offices in the UK, US, and Ukraine, and has 150 customers worldwide. BluePhoenix said that CodeStream was a strong competitor in the modernization of legacy databases, particularly IDMS and other mainframe platforms.
Kilman said, “This acquisition positions BluePhoenix as a strong leader in its area of activity. In addition to its technology, CodeStream has a unique group of employees with exceptional skills in IDMS, as well as a customer base. It also knows the market and thoroughly understands the technology and business needs of its customers. This combination has great business significance for BluePhoenix.”
Herzliya-based BluePhoenix has a market cap of $77 million, following a 36% rise in its share price since January, to $5.50. The company posted a net profit of $3.3 million on a record $49.7 million revenue in January-September. The company’s controlling shareholder in Formula Systems Ltd. (Nasdaq: FORTY; TASE: FORT), control of which was acquired by Emblaze Ltd. (LSE: BLZ) three months ago.
Published by Globes [online], Israel business news - www.globes.co.il - on December 13, 2006
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