Dear STLMD: Excuse me but I differ in your valuation. As to the earnings coming in at 14 cents as compared to 17 cents that seems to be purely attributable to the fact no NOL carryover was available this qtr. I cannot say why that is the case as I dont know, but if you take the begiinning of the year NOL carryover and subtract the income for the first two qtrs there should have been a substantial balance remaining. Had the tax rate been 20% as I originally estimated instead of 39% actual earnings would have been about 20 cents a share. I dont concern myself with the absence of material pass through revenue as the profit is minor, the balance of the reasons they didnt earn the 25 cents I had hoped was costs associated with FUTURE projects expensed in this period. Finally, have you all read this? In reading please note the HUGE contract (s) mentioned in it. JDN
Real Software buys Tava for $190 mln
11:28 a.m. Apr 21, 1999 Eastern
BRUSSELS, April 21 (Reuters) - Belgian software developer Real Software said on Wednesday it planned to take over U.S. computer services firm Tava Technologies in a bid to gain a substantial foothold in the United States market.
Real Software President Rudy Hageman said the company also hoped to announce smaller takeovers in Luxembourg and Switzerland within the next six to 12 months.
The friendly full bid for Tava, which is expected to be concluded by the end of June, would cost $190 million, or $8.00 per Tava share, Hageman told a news conference.
Real Software would pay for the acquisition 75 percent through seven-year loans and 25 percent through existing equity, a strategy which would allow Real Software to retain capital for future development plans.
Hageman said Tava would contribute immediately to profit, adding 16 euros per share to Real Software's pre-acquisition forecast for 1999 of at least 42 euros per share.
TAVA is listed on the New York-based Nasdaq exchange and has top U.S. manufacturers such as Coca-Cola, Hewlett Packard, Boeing, Johnson & Johnson and Microsoft among its clients.
Hageman said the acquisition would enable the new merged company to offer a comprehensive range of information technology products and services in the United States, from the factory floor to financial planning and management. This was similar to the ''one-stop shop'' Real Software offered customers in Europe.
The new company, in conjunction with U.S. utility management consulting firm RW Beck, hoped next month to sign a contract worth over $5 million to provide an computer system to the Mexican Power Authority and was in talks with five U.S. utilities for similar contracts, Hageman said.
As a result of the merger Real Software, which now has five offices in the east and south of the United States, will expand its presence to 20 offices across the country, employing nearly 900 people.
The move would enable Real Software to establish a new home market in the United States, the world's largest information technology market, and offer a base for further expansion, Hageman said.
''We want to create a medium-sized market in the United States and in France and develop our service activities in Britain, where we have four product companies. We are also looking at smaller acquisitions in Luxembourg and Switzerland,'' Hageman told Reuters.
He said TAVA would be delisted from Nasdaq in July. Real Software, listed on the Brussels stock market, did not rule out seeking a listing on Nasdaq at some point in the future.
Real Software posted net 1998 profit of 7.6 million euros, compared to 2.7 million in 1997.
The company's business is 44 percent in Belgium, 21 percent in the United States. After the merger, Real software hopes 40 percent of sales will come from U.S. business, 35 percent in Belgium and 25 percent in Europe and Asia.
($1-38.11 Belgian Franc) |
