Needham & Company Maintains a 'Buy' on SS&C Technologies (SSNC); Acquires GlobeOp; Deal Meaningfully Accretive
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Price: $81.50 -0.66%
Rating Summary:
16 Buy, 4 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 6 | Down: 4 | New: 9
Rating Summary:
16 Buy, 4 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 6 | Down: 4 | New: 9
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Needham & Company maintains a 'Buy' on SS&C Technologies Holdings, Inc. (NASDAQ: SSNC) price target of $26.00.
Analyst, Mayank Tandon, said, "SSNC announced it is buying GlobeOp, a U.K.-based fund administrator, for $897 million or $7.63 per share. SSNC’s bid was 12% higher than that of TPG, the Texas-based private equity firm, which had also bid for GlobeOp. The deal is all cash and will be funded through debt. The acquisition is expected to close mid-year and will require regulatory approval both in the UK and the US. Valuation is about 3.6x EV/LTM revenue and 11.5x EV/LTM operating income."
"The acquisition, once approved, would make SSNC the third largest player in the fund administration market, giving it scale in Europe and an opportunity to cross-sell into GlobeOp’s 200 clients. There is minimal geographic and client overlap between the two companies. Combined, SSNC’s fund administrator business would be $300 billion in assets under administration (AUA). (Standalone GlobeOp had $174 billion in AUA at 2011-end). GlobeOp posted 17% revenue to $221 million and generated 31% operating margins, up 140bps. (We estimate SSNC’s fund administration business has been growing at the high-teens rate and runs at operating margins in the mid-30s)."
For an analyst ratings summary and ratings history on SS&C Technologies Holdings, Inc. click here. For more ratings news on SS&C Technologies Holdings, Inc. click here.
Shares of SS&C Technologies Holdings, Inc. closed at $21.30 yesterday.
Analyst, Mayank Tandon, said, "SSNC announced it is buying GlobeOp, a U.K.-based fund administrator, for $897 million or $7.63 per share. SSNC’s bid was 12% higher than that of TPG, the Texas-based private equity firm, which had also bid for GlobeOp. The deal is all cash and will be funded through debt. The acquisition is expected to close mid-year and will require regulatory approval both in the UK and the US. Valuation is about 3.6x EV/LTM revenue and 11.5x EV/LTM operating income."
"The acquisition, once approved, would make SSNC the third largest player in the fund administration market, giving it scale in Europe and an opportunity to cross-sell into GlobeOp’s 200 clients. There is minimal geographic and client overlap between the two companies. Combined, SSNC’s fund administrator business would be $300 billion in assets under administration (AUA). (Standalone GlobeOp had $174 billion in AUA at 2011-end). GlobeOp posted 17% revenue to $221 million and generated 31% operating margins, up 140bps. (We estimate SSNC’s fund administration business has been growing at the high-teens rate and runs at operating margins in the mid-30s)."
For an analyst ratings summary and ratings history on SS&C Technologies Holdings, Inc. click here. For more ratings news on SS&C Technologies Holdings, Inc. click here.
Shares of SS&C Technologies Holdings, Inc. closed at $21.30 yesterday.
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