Translation specialist in £2.8bn merger talks

TRANSLATION company RWS is set to seal the largest takeover of a UK tech company since lockdown in a deal which will create a £2.8bn firm.

RWS, one of the biggest companies on London’s junior stock market AIM, is buying rival SDL for £854m.

The deal will be a significant win for the UK’s tech sector, creating the world’s largest translation services firm.

Days earlier, British software firm Aveva agreed to buy US rival OSIsoft for £3.8bn in another boost for the UK technology industry.

RWS specialises in translating documents such as instruction manuals, patents, and complex medical research, as well as adverts, into hundreds of languages to allow international companies to trade and work together. It has typically employed specialist teams of highly qualified linguists to complete the translations.

But SDL, in contrast, is using artificial intelligence to create technology which accurately translates documents automatically. SDL’s chairman David Clayton said: ‘The combination will create the world’s largest language services and technology group, leveraging the strengths of both businesses for the benefits of our customers as well as our shareholders.’

Many British firms have scaled back their spending and investment in the face of an uncertain economic future. This has pushed down the value of many businesses, causing the UK to become a hunting ground for private equity firms looking for a bargain.

Bidders are rumoured to be circling telecoms group BT, while breakdown firm the AA has confirmed interest from at least three private equity buyers, and Formula One team Williams was recently snapped up by a US firm.

But the RWS-SDL tie-up will be good news for savers who still want to buy shares in in UK firms and capitalise on their success. RWS already works with some of the biggest US tech giants, while SDL boasts 90 of the world’s top 100 brands as its clients.