Focus Solutions set for £42m takeover

WARWICKSHIRE based financial software supplier Focus Solutions is set to be acquired by Standard Life in a deal valuing the firm at £42m, it was confirmed today.

Speculation about a takeover had been rife for a month and in a statement today the boards of both firms said they had reached an agreement on the deal.

Investors recated strongly to the news and Focus shares were up almost 10% in early trading.

The offer, based on 140p a share, represents a premium of 33.3% on the November 8 closing price of 105p – the last business day prior to the announcement by Focus that it was in discussions which may or may not lead to an offer being made for the company.

In a joint statement, the firms said: “The boards of Standard Life and Focus believe the acquisition of Focus by Standard Life will provide Focus’ customers and staff with the benefits of a strong and well-resourced owner whilst retaining the innovation and flexibility that Focus’ customers have historically enjoyed.   The Standard Life directors support the development of Focus’ existing strategic roadmap and continued investment in Focus’ highly rated technology platform.”

The announcement came on the day Focus released interim results for the six months to September 30 showing revenues in the first half of the year were up 26% over the same period last year at £5.43m (H1 2009: £4.30m).

Pre-tax profits rose to £1.15m compared with £0.15m in the same period last year, reflecting the strong start of the year for the Leamington firm.

Operational highlights during the period included the firm’s largest ever contract – a £10m two-year deal to supply a major global bank. The firm also secured a third contract win from a UK bank plus a £1m contract extension from HSBC.

Commenting on the takeover, Focus chief executive Richard Stevenson said: “The acquisition by Standard Life represents a great opportunity for Focus both to accelerate the customer reach of our award winning software and to drive further investment in our highly rated platform, enhancing our position in the industry.  

“While we will continue to deliver best-in-class solutions to our target market, going forward our customers, employees and our business will have the benefit of the support and reach that being part of the Standard Life Group will bring.”

David Nish, group chief executive of Standard Life, said the acquisition was consistent with the firm’s growth strategy.

“The acquisition of Focus provides further capability in providing support, technology and innovation to our core markets and customers,” he said.