4Front Technologies, Inc. Agrees to Buy CVSI, Inc.
Further Enhances 4Front's Strong Position in European IT Services Market; Annualized Revenues Approach $350 Million with Acquisition; Service Revenues Surpass 75% of Total Revenues with Acquisition
LONDON--(BUSINESS WIRE)--Sept. 22, 1999-- 4Front Technologies, Inc. (''4Front'') (Nasdaq NM/EASDAQ Symbol: FFTI) today announced that it has agreed to acquire CVSI, Inc. (''CVSI''), a leading provider of IT services on a worldwide basis.
Based in Bedford, Massachusetts, CVSI has principal operating locations in the UK, France, Germany, Italy, Holland, Sweden, the United States and Japan. 4Front has agreed to acquire the stock of CVSI for aggregate cash consideration of $25.5 million including the discharge of debt. 4Front will finance the acquisition through a combination of bank financing and available cash.
4Front anticipates that CVSI will contribute revenues of at least $100 million in calendar 2000. The Company expects CVSI to be earnings neutral in the current fiscal year and accretive to earnings beginning in calendar 2000. Just over half of CVSI's current revenues are generated in Europe, over 35% come from North America and the balance from the Far East.
CVSI delivers enterprise-wide hardware and software support services, systems integration and consulting services, and a full suite of network services to a wide range of blue-chip customers around the world. CVSI has particular strength in the provision of services to the mid-range computer market and maintains strategic partnerships with several of the world's leading information technology providers.
Following the close of the acquisition, 4Front will have annualized revenues approaching $350 million, of which over 75% will be service revenue. In addition, following the acquisition, 4Front will have more than 2,000 employees, including more than 1,400 highly skilled technical staff.
Anil Doshi, Chairman and CEO of 4Front, said, ''CVSI, which is our largest acquisition to date, is a perfect fit for 4Front in several respects. CVSI's wide range of high-end services will assist 4Front's progression up the computer services value chain and will greatly enhance 4Front's already strong services offering to what will now be a substantially enlarged international blue-chip customer base. CVSI's significant European presence enhances 4Front's already strong position in the European IT services marketplace. Furthermore, while 4Front's principal aim remains to establish itself as one of the top five European IT service providers, CVSI's locations in North America and the Far East offer us increased exposure to worldwide IT industry trends.''
Robert Peiser, Chairman of CVSI, said, ''CVSI welcomes becoming part of a company with an excellent track record of successful growth in our industry. 4Front is clearly an ambitious company with excellent resources and operations in what we know to be a rapidly growing world-wide market. This transaction offers our employees an excellent opportunity to participate in and benefit from 4Front's exciting growth plans. Additionally, our customers can only benefit from the combined companies' stronger financial resources and broader range of services and technical expertise.''
Completion of the acquisition is conditional upon receipt of regulatory and other consents.
About 4Front Technologies, Inc.
4Front Technologies, Inc., is a leading provider of information technology and outsourcing solutions, which consist of specialized computer services and complementary products, primarily to blue-chip corporations throughout Europe. 4Front's services and solutions include help-desk support, education services, product-related services, network services, systems integration, specialized software services and products and the supply of high-end storage systems. 4Front's customers include British Petroleum, British Telecom, Telecom Italia, Computer Sciences Corp., IBM, Phillips, Nokia, Siemens, Sony, Cegedim, Renault, Energis, Pfizer, Cariplo, Societe Generale and the UK Ministry of Defence. Additional information on 4Front can be found on the Company's website at www.4fti.com.
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Contact:
Investor Relations Contact:
Abernathy MacGregor Frank
Jason Thompson (U.S. Investor Relations)
Tel: 212/371-5999
or
Shandwick International
David Hothersall or Buster Cheetham
(U.K. Investor Relations)
Tel: 011-44-171-329-0096
or
Company Contact:
4Front Technologies, Inc.
Mark Ellis or Ken Newell
Tel: 011-44-171-269-5848 |
