RWS and SDL combine to create £2.7bn language services giant
A TIE-UP worth £2.7bn on London’s junior market will create one of the world’s largest translation companies, the latest in a string of software deals in the City.
Buckinghamshire company RWS, an Aim-listed specialist in translation software, has snapped up SDL in an allshare deal, valuing its rival at £726m last night. The deal values the merged group at £2.7bn and is expected to place it among the top five Aim-listed tech companies. SDL shares jumped by more than 30pc on the news to 782p, while RWS fell 12pc to 650p. RWS, based in Gerrards Cross, provides specialist technical translation for companies filing patents, counting many of the world’s top 10 pharmaceutical firms among its clients.
The linguistics company, which is valued at just under £2bn, also works with technology companies to translate their content for local markets.
The company hopes to use SDL’s machine learning and AI technology to improve its translation offering and open itself up to new clients.
Once closed, the deal will be the largest takeover of a UK-listed technology business since the start of the pandemic.
It comes amid a series of deals for tech companies on the London Stock Exchange, including the takeover by industrial software company Aveva of US firm OSIsoft last week. The enlarged group will have combined revenues of around £732m and an adjusted profit before tax of £109m. The RWS board has tipped a double digit increase in earnings within the first financial year.
The company has identified £15m worth of cost-savings, which are likely to include job losses and other spending reductions. Much of the savings will come from combined “corporate and support functions” as well as combined “sales and marketing” activities.
RWS’s main shareholder and chairman Andrew Brode and chief executive Richard Thompson will run the combined company.