Application outsourcing firm Keane Inc is continuing its recent acquisition spree with the acquisition of IT consultant Nims Associates Inc.
Under terms of the deal, Boston, Massachusetts-based Keane will pay an initial $20m in cash to acquire Nims, and a further $15m based on the company achieving certain performance targets over the next three years.
Decatur, Illinois-based Nims provides IT consulting services, project management, application development and training services from its eight offices and two Advanced Development Center locations in Indianapolis and Dallas. In its most recent fiscal year ended 2003, it reported revenue of $48m. As a result of this, Keane will pay a sizable premium for the company at more than a third its annual sales.
Nims has a 25-year history in the IT services market. It was set up by current chairman Bruce Nims, who Keane said will now retire from the company, while president Dwight Berryman will join Keane as group VP.
At the same time, Keane reported its fourth-quarter and full-year results, which showed the company is improving its bottom line. For the three-month period ended December 31, Keane reported a net profit of $6.5m compared to a net loss of $6.8m in 2002, on revenue that fell 8% to $212.5m.
Revenue during the quarter was negatively affected by a $4m shortfall relating to the settlement on a development project. In the full-year period, Keane improved it profitability, and reported a net profit of $29.2m compared to a profit of $8.2m, on revenue that fell 8% to $805m. During the year, Keane also repurchased 6.5 million shares for $67m in an attempt to boost its share price.
Keane said it expects revenue for the first quarter of 2004 to be between $205m and $210m, including $3m from the Nims purchase, with earnings of between $0.08 and $0.10 per share.
This article is based on material originally published by ComputerWire