News Column

Kofax Makes German Acquisition And Plans To Cancel London Listing

September 2, 2014

Samuel Agini

LONDON (Alliance News) - Kofax Ltd on Tuesday said it intends to delist from the London Stock Exchange in favour of New York's NASDAQ, unveiled a USD34.7 million acquisition in Germany, and said its finance boss it set to resign, all as it reported a drop in full-year pretax profit.

In a full-year results statement for the year ended June 30, Kofax said pretax profit fell to USD16.8 million from USD18.2 million last year. Revenue increased by USD23.4 million to USD289.7 million, due to growth in the Americas, Europe, Middle East, Africa, and Asia Pacific. Operating costs and expenses increased by USD38.3 million to USD279.4 million.

Net profit increased to USD11.4 million from USD10.0 million, as income tax fell to USD5.4 million from USD8.2 million.

In addition, Kofax said it intends to seek shareholder approval to delist from the London Stock Exchange on or before the end of March 2015.

"This decision was made by the board after careful consideration and recognizing that more than 78.0% of Kofax’s shares of common stock were held by US shareholders, board members and affiliated parties as of July 31, 2014 and that the majority of the total daily share trading volume routinely occurs on NASDAQ," the company said in a statement.

The current plan is for shareholders to vote on the proposal at an extraordinary general meeting scheduled for February 9 2015.

Meanwhile, Kofax said it paid an initial USD31.2 million for Softpro GmbH, which provides signature verification, fraud prevention and electronic signature software and services. The remainder will be split into three parts, with USD1.1 million to be paid 90 days after closing, USD1.2 million to be paid a year from closing, and USD1.2 million two years from closing. The additional amounts depend on some indemnification terms and conditions.

Softpro is a privately held company headquartered in Boeblingen, Germany with approximately 80 employees located mainly in Western Europe and the US.

It reported USD13.3 million of revenue for 2013, of which 38% arose from software licenses, 50% from maintenance services, 3% from professional services and 9% from the resale of hardware devices for signature capture purposes. It reported USD1.0 million of adjusted earnings before interest, tax, depreciation and amortisation in 2013 and USD6.1 million of gross assets.

"Softpro has established itself as a trusted solution provider with many of the world’s largest banks – including Citibank, JP Morgan Chase, Wells Fargo and others – as well as leading financial institutions, retailers and government agencies in more than 50 countries. Its software offers enhanced capabilities to Kofax customers who want to embed it within their smart process applications, thus making the First Mile of customer interactions even smarter," Kofax Chief Executive Reynolds Bish said in a statement.

Kofax said it expects to complete the integration of Softpro by the end of calendar year 2014.

B Riley & Co LLC initiated and acted as Kofax’s financial advisor for this transaction.

Kofax also said Chief Financial Officer Jamie Arnold intends to resign for personal reasons by the end of September 2015.

"We’ll initiate a search for his replacement and believe this will be successfully accomplished within a period of time needed to ensure a smooth transition of his responsibilities," Reynolds C. Bish said in a statement.

Kofax shares were in London Tuesday quoted up 2.0% at 474.25 pence.

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Source: Alliance News

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