Globo, an enterprise mobile messaging and device management and application development software developer traded on the London Stock Exchange’s small-cap AIM Market, has bought the mobile application development service Sourcebits.
Founded in 1997 as a content management company, Globo went public on the AIM in 2008 as it transitioned from content management into mobile device and messaging management for the enterprise. With the Sourcebits acquisition the company does two things according to chief executive Konstantinos (“Costis”) Papadimitrakopoulos — gets more of a foothold in the U.S. market and adds to its mobile product suite.
“Sourcebits is one of the leaders in mobile application development,” says Papadimitrakopoulous. The company was generating revenues of roughly $8 million, with earnings before interest, taxation, depreciation and amortization coming in at $1.8 million. Meanwhile, Globo saw year end revenue of Euro 72 million and Euro 35 million (roughly $98.6 million in revenues and $48 million in EBITDA).
Terms of the acquisition were not disclosed, but as service providers typically trade for 1.5 times to two times their revenues, which would put the Sourcebits deal at or below roughly $20 million.
The Sourcebits acquisition is just the first step in Globo’s transition to become a more North American-facing business — so venture investors be prepared. “We are going to execute several acquisitions in the U.S.,” says Papadimitrakopoulos. “The company is shifting to more of a U.S. centric technology company.”
Specifically, Papadimitrakopoulos says his company will seek businesses developing new security and mobile development applications.
One reason for the move to the U.S. is the company’s desire to list on one of the U.S. exchanges, according to Papadimitrakopoulos. Globo is considering jumping from the AIM to potentially the Nasdaq as it rolls up more businesses in the U.S. “Shifting from AIM to Nasdaq… we consider to be much more favorable,” says Globo’s chief executive. “U.S. tech investors are much more knowledgeable. Having a fairer valuation against our peers will give us the ability to compete on a much more equal basis.”
That could be welcome news for investors like Sequoia Capital, which invested alongside IDG Ventures India in a $10 million financing for Sourcebits.
“The evolution of the mobility space is so massive it will create different spin offs on top of the platform business that we’re building today,” says Papadimitrakopoulos.