Q: With Today's announcement, Topicus.com made a deal to acquire additional shares and will now own 24.84% of issued share capital of Asseco Poland (subject to regulatory approvals) for a total cost of US$438 Mln.
Asseco operates with a similar model as Topicus and primarily targets the healthcare, financial services and public institutions verticals, as well as the energy and telecommunications verticals.
Topicus has also committed to not increasing its stake beyond a maximum of 27.96%.
Question:
1. What are your thoughts on this investment/acquisition towards adding long term value and ROC to Topicus shareholders ?
2. Being a large acquisition, how do you believe, Topicus will finance it - from existing cash or there is a possibility of a rights issue of some nature ?
Thank You
Asseco operates with a similar model as Topicus and primarily targets the healthcare, financial services and public institutions verticals, as well as the energy and telecommunications verticals.
Topicus has also committed to not increasing its stake beyond a maximum of 27.96%.
Question:
1. What are your thoughts on this investment/acquisition towards adding long term value and ROC to Topicus shareholders ?
2. Being a large acquisition, how do you believe, Topicus will finance it - from existing cash or there is a possibility of a rights issue of some nature ?
Thank You
5i Research Answer:
While we might prefer a more typical deal with total control of a company (or at least 50%), we still think it is attractive for TOI. Asseco Poland S.A does pay a 3% dividend, at a minimum. It gets TOI a seat at the table for future deals, and more access to Poland, an economy which is very strong right now. We do think it will add value. TOI has decent cash liquidity right now and more than 300M euros in cash flow annually. It should be able to finance this internally.