Claranova Bought Minority Interests As A Part Of External Growth Strategy


As per its official announcement, the Claranova Group—Paris-based technology group— has recently signed an agreement as a part of its external growth strategy. The company had previously announced about their improved profitability and strong, speedy growth in early October by declaring the financial year 2018-19 as an excellent period for the company.

Recently, the company has decided to make deal with minority stakeholders in Avanquest Canada Inc. The company has decided to buy out the remaining shares of minority and management shareholders. Currently, the Avanquest Software SAS owns SodaPdF, Adware businesses and Upclick. As per the proposed deal, these minority shareholders have to transfer their 70% shares for $68.28 million. The deal is said to be approved in a meeting of combined shareholders on December 9, 2019 by Claranova Shareholders.

The proposed deal is said to be an example of ideal deal. The deal not only focuses on excellent external growth strategy of the company and a beneficial incorporation of newer companies in internet segment but also provides a progressive and gradual offer to those minority shareholders. It also provides a golden opportunity of gaining additive 30% earnings per share (EPS) in upcoming two financial years.

In previous year, Claranova has integrated these businesses to strengthen the position in the segment. As a result, Claranova’s revenue hiked up to 132% whereas the company also managed to improve its profitability with additional 10 points. Prior to this time, Claranova was able to buy preferred shares of class A and class C only. If the deal is approved and everything goes as preplanned, the group will be able to buy class B preferred shares also. This will allow the company to gain access to the entire stock capital of the subsidiary, Avanquest Canada Inc.

The deal is said to be advantageous in increasing profitability and controlling the cash flow in internet sector, as well. It will also improve investment capacity in external growth and organic development.

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