Global B2B information service provider, Euromoney Institutional Investor (LON:ERM), announced the $14.5 million acquisition of WealthEngine Inc.
WealthEngine is a Software as a Service platform that provides data-driven intelligence analytics to wealth managers, luxury brands and not-for-profit organisations. The company profiles US individuals in order to identify potential donors and customers for its clients, with revenues primarily derived from subscriptions.
Euromoney Ins. Inv. Said the acquisition adds scale to its People Intelligence business, which is now comprised of Wealth-X, BoardEx and WealthEngine. The Group added that the WealthEngine acquisition compliments its other recent addition, Wealth-X, whose database profiles high and ultra-high-net-worth individuals.
When added to the relationship mapping services of BoardEx, Euromoney states that it now has ‘full coverage across the wealth intelligence value chain’. It added that WealthEngine’s Annual Contracted Value of subscriptions and pro-forma EBITDA are expected to be $15.0 million and $2.0 million respectively.
The Euromoney Institutional Investor statement said: “This highly complementary acquisition is expected to enhance the operating profit margin of People Intelligence and deliver accelerated growth over the medium-term. As a result, the acquisition is expected to be earnings accretive for Euromoney and deliver ROI above WACC in the current financial year.”
James Lavell, Group CEO People Intelligence, added: “The acquisition of WealthEngine is a great addition to the Group and supports our strategy by adding further scale to our 3.0 People Intelligence business. It brings leading technology, workflow solutions and must‐have data, which, when combined with Wealth-X and BoardEx, will enhance significantly the value we provide customers.”
Following the update, Euromoney shares initially jumped by around 3%, though fell to a 0.58% rally, at 1,040.00p 13:00 GMT 08/12/20. The price is around 2.2% ahead of analysts’ consensus price target of 1,016p, but just short of its post-lockdown high of 1,064p a share.
Analysts currently have a consensus ‘Hold’ rating on the stock, while the Marketbeat community offers a 56.75% ‘Underperform’ stance. The company has a p/e ratio of 36.11, and a dividend yield of 3.17%.