 "Persistent Systems hits 52-week high on acquiring US firm for $20.7 mn")
Persistent Systems shares rise: On Wednesday, Shares of Persistent Systems soared up to 2.08 per cent, hitting its 52-week high at Rs 4,592.50 per share on the BSE in intraday deals.
This came after Persistent Systems Inc., the US-based subsidiary of company, entered into a stock purchase agreement on July 2, 2024, to acquire Starfish Associates for a total acquisition cost of $20.7 million.
The agreement includes an upfront payment of $15.4 million, which will be paid to shareholders upon closing. This initial amount is subject to customary adjustments for factors such as working capital, debt, and cash balances, the company said in an exchange filing.
In addition to the upfront payment, sellers of Starfish Associates have the opportunity to earn up to $5.1 million in cumulative earnouts over the next two years. These earnouts are contingent upon achieving specific performance targets set forth in the agreement.
Furthermore, key employees of Starfish Associates stand to receive a retention payment totaling $0.2 million over the same two-year period, provided they remain employed with the company.
“This strategic acquisition builds on Persistent existing engineering capabilities in the Contact Center and Unified Communications space, expanding its strong AI-driven business transformation capabilities and expertise in driving operational excellence,” the Indian IT major said in a statement.
The enterprise communication platform of Starfish excels as an intelligent integration hub and workflow engine, facilitating seamless connections across a myriad of business applications and communication systems, the company said.
More From This Section
Starfish had last twelve months revenue of US $8.2 million as of March 31, 2024.
Persistent Systems has a total market capitalisation of Rs 70,400 crore. It is presently trading at a price to earnings multiple of 35.16 times with an earning per share of Rs 127.97.
At 12:09 PM; the stock of the company was up 1.32 per cent at Rs 4571.20 a piece on the BSE. By comparison, the BSE Sensex index was up 0.51 per cent at 79,847.14 levels.