Brisbane-based software entrepreneur Richard Matthews has pulled off another great deal, this time at billing software company eServGlobal, which has sold its US business to global giant Oracle for $114 million – well above the $84 million market value the company had before the deal was announced.
The sale, announced after the Australian Securities Exchange closed last night, has set a rocket under eServeGlobal shares this morning, which climbed 23% in morning trade to 53c.
The deal, which will see Oracle take over eServGlobal ‘s USP products division, which focuses on billing software for telecommunications carriers, still needs to be approved by eServGlobal’s shareholders, although 19% shareholder Guinness Peat Group has said it will vote in favour of the transaction.
Matthews and a close associate Craig Halliday own a combined 20% of the company.
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This is not the first major deal Matthews has pulled off. As chief executive of Brisbane-based mining software company Mincom, Matthew orchestrated a $315 million buy-out by US private equity company Francisco Partners.
He personally received around $27 million in that deal, much of which was reinvested into eServGlobal in 2009.
Matthews is currently in Britain and was not available for comment this morning. However, the company said in a statement that its decision to sell its telco billing platform was driven by the fact that the platform only addressed the pre-paid segment of the market, and without a post-paid offering it would be difficult to compete.
Given the USP business accounted for 42% of eServGlobal’s revenue, the company will refocus its business to concentrate on providing telecommunications carriers with billing platforms for mobile financial services and international money transfers.
The shareholder meeting to approve the deal will be held on June 30.