Asseco Poland SA, the Polish company that’s central Europe’s largest software maker, agreed to buy a majority stake in Formula Systems 1985 Ltd. for as much as $145.3 million as part of its foreign expansion.
The purchase of a 51.2 percent stake in the Israeli-based software-services company from Emblaze Ltd. and a member of Formula’s board will help Asseco raise annual revenue by about 50 percent, Chief Executive Officer Adam Goral said today.
“The reason for the expansion is not only to boost profit and sales but also to gain know-how and access to new markets,” Goral said at a news conference. “We’re paying a lot but we are paying for a huge value.”
Formula’s first-half sales stood at $262.6 million and net income was $8.6 million, according to a statement distributed to the media in Warsaw. Asseco had revenue of 1.45 billion zloty ($474 million) in the first half, with net income of 205.4 million zloty, the company said Aug. 27.
Asseco, whose shares declined 0.2 percent to 55 zloty at 2:22 p.m. in Warsaw, will finance the acquisition with its own cash and from an existing credit line, Goral said.