Advent to acquire leading RMS provider Tamale Software

Date: Friday, September 12, 2008
Author: Hedgeweek.com

Advent Software, Inc, a leading provider of software and services for the investment management industry, and Tamale Software, Inc., a leader in research management solutions (RMS), have signed a definitive agreement under which Advent will acquire privately held Tamale Software.

"We're thrilled to have Tamale's innovative technology and proven team on board as we enter the nascent and fast-growing RMS market," says Advent's Founder and CEO Stephanie DiMarco. "We chose Tamale Software because, as the clear industry leader and a pioneer in the field of RMS, they bring unparalleled vision and a track record of success as we extend Advent's footprint in the front office with this powerful, game-changing productivity tool for our clients' investment teams."

In recent years, the investment community has struggled to effectively manage and leverage across their organizations a massive influx of investment information (sell-side research, email, independently produced analysis, news, and internet content) in an increasingly complex compliance environment.  

Tamale Software solves this problem with Tamale RMS, the firm's innovative workflow software solution that creates a centralized information hub to easily manage and access research information, enhancing collaboration across the investment team and optimizing the investment decision-making process.  

Since pioneering the RMS space in 2004, Tamale Software has become a clear leader, with more than 1,700 investment professionals at hedge funds, endowments, funds of funds, private equity firms and traditional asset management firms using Tamale RMS to manage their workflow and research process.   
 
"Becoming part of the Advent team gives Tamale a tremendous opportunity to expand our global reach and bring the benefits of RMS to a much wider audience," says Tamale's President and CEO, Mark Rice.  "We are excited to be joining forces with a proven leader that shares our commitment to innovation and driving success for our clients."

The Tamale management team and its employees, based primarily in New York, Boston and the UK, will join Advent, and will continue to develop, service and sell the Tamale solution.

Under the terms of the agreement, Advent will pay approximately USD 70 million for all of the outstanding capital stock of Tamale, with 60 percent of the consideration payable in shares of Advent's common stock and the remaining 40 percent in cash.  Advent will issue approximately 900,000 shares based on the average closing price of USD 46.44 for the 15 trading days prior to the signing date, in addition to approximately USD 28 million in cash consideration, subject to adjustment for third-party expenses and certain other specified items.  No options will be assumed by Advent in connection with this transaction.  The acquisition is subject to customary closing conditions and is expected to be completed during the fourth quarter of 2008.  

Tamale is a subscription-based business.  Based on Tamale's 2008 customer acquisition and run rate, Advent estimates 2009 revenue from Tamale to be in the range of USD 17-20 million.  In addition, Advent expects the transaction to be neutral to earnings per share (EPS) in 2009 on a non-GAAP basis and dilutive to EPS on a GAAP basis, which will include stock-based compensation and amortisation of acquisition-related intangibles.

GCA Savvian Advisors, LLC acted as exclusive financial advisor to Tamale on this transaction.