Israeli IT companies One Software Technologies (TASE: ONE) and Taldor Computer Systems (TASE: TALD) have announced that they will merge. The deal will be in the form of a reverse triangular merger, at the end of which One Software Technologies will hold all the shares in Taldor Computer Systems in return for NIS 250 million cash (at NIS 22.50 for each Taldor share, representing a 30% premium on Taldor's closing price yesterday).
Before the merger is carried out, Taldor will distribute a dividend of NIS 16.6 million (NIS 1.5 per share) to its shareholders. The deal is subject to the receipt of various approvals, including by a general meeting of Taldor's shareholders.
With an annual sales turnover of some NIS 2.5 billion and 6,500 employees, the merged group will be one of the two biggest players in information technology services in Israel, with a presence in every sector of the economy.
In response to the announcement, One Software Technologies' share price has risen 5.47% on the Tel Aviv Stock Exchange, while Taldor's share price has shot up 34.57%.
One Software Technologies CEO Adi Eyal said, "The merger of Taldor into One is a significant event with huge potential for both companies, their employees and their customers. Although the two companies operate in the same sector, they complement each other in their areas of activity, such that the linkup between them will create a substantial and long-term power multiplier and holds out significant opportunities for development and growth for the managers and staff of both companies."
Taldor chairman Barak Dotan said, "The merger of One Software Technologies and Taldor is the right business move for Taldor, its staff, management, customers, and shareholders. I thank the company's management and staff who have led the company to the status of one of the leading IT companies in Israel. The fact that the DNA of the two companies is similar, and the fact that a substantial part of Taldor's activates does not exist at One Software Technologies, and thus complements them, represented an additional consideration in our decision on the merger with One. We think that his is a wonderful deal for all parties, and we are glad of the opportunity we have had to lead Taldor for many years, and proud of the current move, that will provide value to our shareholders."
Published by Globes, Israel business news - en.globes.co.il - on November 10, 2020
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