Linedata has agreed to acquire HCL Technologies' CapitalStream business and enter into a strategic partnership with HCL Technologies Ltd. The transaction is expected to close before the end of Q1 2013 and involves Linedata acquiring all the assets and associated liabilities for a sum of $45 million.
The complicated acquisition of HCL Technologies' CapitalStream business by Linedata will be financed by an extension of an existing bank loan with a pool of banks, explains the credit software and services specialist. Following the transaction, debt ratios will remain at a reasonable level and the leverage ratio of less than 2 (net debt post-closing / consolidated earnings before interest, taxes, depreciation and amortisation (EBITDA) will favourable claims Linedata.
Linedata is one of the leading providers of software and services to the credit and financing industries in Europe and Africa. It has also developed a presence in North America in the asset management area and is hopeful that this latest acquisition will strengthen its position in the North American market.
The wider strategic link-up with HCL Technologies, the owners CapitalStream, is expected to reinforce Linedata’s services offering and provide on-going support to existing CapitalStream clients in North America.
Commenting on the deal, Anvaraly Jiva, the founder and chief executive officer (CEO) of Linedata, said: "I am very pleased to welcome this highly talented team and prestigious client base to Linedata. This acquisition will extend our ability to provide end-to-end solutions to the credit and finance industry globally. The partnership with HCL will substantially improve our ability to engage in very large projects with our clients. Linedata’s presence in North America, a key to our global growth, will also be significantly expanded.”