finnCap Research Company Notes - 11 October 2019

Oct 11, 2019 / News

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Sector: Technology & Telecoms

Ideagen (IDEA) : Corp

Bolt-on acquisition


Key data                              

Share price (p)                  149.0

Target price (p)                180.0

Market cap (£m)                              327.5

Enterprise value (£m)                    328.8


Demonstrating execution of its successful combination of organic and acquired growth, Ideagen has acquired Optima Diagnostics, a London-based provider of a SaaS-based Health & Safety compliance solution with an 80-strong customer base including well-known names such as Airbus, Sellafield and BAE. With £0.9m ARR (£1m total revenue), acquired at 2x recurring revenue, the acquisition continues Ideagen’s drive to consolidate the fragmented elements of the Quality, Health & Safety, and Environment Management Software subsectors, accumulating a broader client base to better support current requirements as well as assisting their inevitable transition to the cloud. We lift forecasts to accommodate £0.3m EBITDA from £1m revenue in FY21. Integration will adopt Ideagen’s methodical approach to acquisitions – also, typically, comfortably funded from existing resources. Target 180p reiterated.


Andrew Darley

020 7220 0547


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