Technology consultancy Detica is acquiring London-based Evolution Consulting, a specialist firm focusing on the wholesale financial services sector, for approximately £8.5 million in cash.
Evolution is a privately-owned IT consultancy that currently employs 105 staff specialising in the capital markets sector.
Following the acquisition, Evolution's employees will be integrated into Detica's existing financial services business. Evolution chief executive Steve Mitchell will assume management responsibilities for the enlarged group and will report to Detica UK MD Colin Evans.
Tom Black, chief executive, Detica, says: "Evolution will further extend our presence in the financial services sector and will augment our talent pool by adding a team of senior consultants who have substantial sector experience and contacts."
In its audited accounts for the year ended 31 August 2005, Evolution reported revenues of £8.8 million, profits before tax of £0.6 million, and, as at that date, it had gross assets of £3.4 million and net assets of £1.7 million.
The acquisition price is subject to Evolution's working capital at completion. Pending that determination, approximately £1.3 million of the consideration will be deferred. Detica says the total acquisition cost, including fees and the working capital adjustment, is expected to be approximately £9.5 million.
Detica says its expects the transaction to be earnings-enhancing in the first full financial year post-acquisition.
The deal is expected to complete in January 2006.