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Nasdaq-listed Ebix Inc has acquired Pune-based Indus Software Technologies Pvt Ltd for $29 million, including $5 million of contingent earnout.
Indus is a global provider of enterprise lending software to financial institutions, captive auto finance and telecom companies.
The move marks Ebix’s ninth acquisition since its entry into India in May 2017.
Ebix is an international supplier of on-demand software and e-commerce services to the financial, insurance, healthcare and e-learning industries. The acquisition of Indus will increase its employee strength in India by 900 to about 7,200.
Indus will be integrated into EbixCash, Ebix’s financial exchange offering.
Ebix Chairman, President and CEO Robin Raina said: “We have always believed that lending is a must-have functionality for any leading end-to-end financial exchange. Accordingly, in our vision plan for EbixCash with respect to the area of lending, we see three opportunities: one, powering the technology for lenders in any industry; two, creating a person-to person lending exchange that can be available over the web, e-wallets, mobile phones, white label corporate intranets and EbixCash outlets to consumers; three, lending services for our EbixCash outlets that allow them to borrow and expand their business with EbixCash. The acquisition of Indus is a step in the direction of accomplishing the first step of that vision plan.”
In FY17, Indus had revenues of $22 million and EBITDA of about 17 per cent.
Ebix believes the business can continue to grow at the rate of 12-15 per cent annually with operating margins of 30 per cent or more, once fully integrated. It expects the acquisition to be immediately accretive to its earnings and forecasts $0.19 in increased diluted EPS, once the acquisition is fully integrated over the next six months.
Ebix funded the acquisition from internal cash reserves and did not use any investment bankers for the transaction. KeyBanc Capital Markets advised Indus and its principal owners Black Dragon Capital.
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