Language translation technology group SDL (SDL) has agreed to acquire Donnelley Language Solutions or ‘DLS’ for $77.5m (£60.1m), from New York-listed Donnelley Financial Solutions (DFIN). SDL says it will finance the acquisition partly with new debt facilities, and partly via the placing of 8.2m shares at 440p each – representing around 10 per cent of its share capital – to raise gross proceeds of up to £36.2m.
DLS provides language services and linguistics, and operates in two of SDL’s ‘premium sectors’ – financial services and life sciences. For the year to December 2017, it enjoyed around 5 per cent revenue growth to $71.4m and adjusted cash profit of $5.8m. It has also seen revenue and profit growth for the year to date so far.
SDL says the transaction will add pace to its premium-sector growth as well as providing opportunities to cross-sell products to existing customers and cut costs. The acquisition and placing should be earnings-enhancing for the year to December 2019.
