Sopra Steria Signs Acquisition Agreement With Sodifrance to Create a French Leader in Digital Services for Insurers and Social security Providers

Regulatory News:

Sopra Steria (Paris:SOP) (Euronext Paris: SOP), a European leader in digital transformation, has signed an acquisition agreement with a view to acquiring a controlling interest in Sodifrance SA, corresponding to 94.03% of its share capital.

Following the 21 February 2020 press release announcing that they had entered into exclusive negotiations, Sopra Steria and Sodifrance’s majority shareholders have announced that they have signed an agreement for the indirect acquisition by Sopra Steria (via the acquisition of HP2M SAS and STRATEG’e.BOSS SAS) of a controlling interest in Sodifrance SA, corresponding to 94.03% of its share capital, for an overall fixed price equivalent to €62.8 million¹ for 100 % of the share capital.

The acquisition of this controlling interest would be paid entirely in cash. In accordance with applicable regulations, following the acquisition of the controlling interest, Sopra Steria will file a proposed delisting offer (offre publique de retrait) with the AMF (France’s financial markets regulator) followed by a mandatory delisting procedure for the remaining shares not tendered to the offer, at a price of €17.99 per share.

Pursuant to Article 261-1-I-1° and 2°, and Article 261-1-II of the AMF’s General Regulation, an independent expert will be appointed by Sodifrance’s Supervisory Board to assess the fairness of the financial conditions of Sopra Steria Group’s delisting offer.

Founded in 1986, Sodifrance is a French digital services company with 2019 revenue of €106.5 million and an operating margin of 6.4%. It has substantial expertise in the insurance and pensions/social security/health sector (50% of revenue) for key accounts. It also has a strong presence in the banking sector (21% of revenue), and offers very high-quality application modernisation, data migration and cybersecurity services.

The transaction with Sodifrance will allow Sopra Steria to attain leadership in the insurance and social security sector in France, with a business volume of about €200 million, while acquiring new clients and strengthening existing client relationships. It will expand the Group’s offering in this sector (consulting, solutions, technological and digital expertise), which will enable it to accelerate the modernisation of legacy applications used by key accounts. Cost synergies are estimated at €4.6 million on an annual basis starting in the second year, for an implementation cost of €3.8 million.