U.K.-based IT software and services provider, Advanced Computer Software Group (Advanced) — which has clients in both public and private sectors in its home market and abroad — has announced the acquisition of education software provider Serco Learning for £7.25 million ($11.6 million) in cash, £6.25 million of which is payable to Serco Group and £1 million to outsourcing company iGate for the novation of a material services contract (in 2011 iGate and Serco inked a five year deal to deliver SAP services to Serco customers).
Advanced said it expects the acquisition to complete on December 31, 2012.
Serco Learning’s business will be integrated into Advanced’s Advanced Business Solutions division – which offers back-office products, including students records services, and currently has 49 university college customers signed up. ACSG said it sees “significant opportunities” for cross-selling products and services to public sector customers — noting that Serco Learning is also a public sector supplier.
In a statement, Advanced’s CCEO, Vin Murria, described the acquisition as “earnings enhancing” and “complementary” to its existing education sector offering. “It provides us with greater critical mass and a broader offering for the growing education market in the UK, Ireland and Asia Pacific,” he said. Cost savings are also anticipated.
In the year ended December 31, 2011, Serco Learning had revenue of circa £13.5 million, of which approaching £11 million was “contracted recurring”, generating approximately £1.2m of adjusted EBITDA.