Cisco Systems Inc. (NASDAQ: CSCO) said on Monday that it will buy IMImobile plc (LON: IMO), UK customer service software maker, for £543 million. The deal marks the largest for Cisco in the United Kingdom since 2018.
The news comes nearly a month after Cisco published its financial results for the fiscal first quarter that topped analysts’ estimates for earnings revenue. Cisco had forecast a 2% revenue decline in Q2 last month.
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The cash offer values IMImobile at 595 pence per share
The cash offer values IMImobile at 595 pence per share that represents a 48% premium on the per-share price at which its stock closed the regular session on Friday. According to Cisco, bringing the London-based cloud communication software and services company under its umbrella will help it expand its footprint in automation.
IMImobile opened more than 45% up in the stock market on Monday. Including the price action, its stock now has a per-share price of 593 pence versus a sharply lower 235 pence per share in March, when the ongoing Coronavirus pandemic wreaked havoc on the global financial markets.
IMImobile shares, that you can learn to buy online here, had started the year at 341 pence per share. The cloud communications company performed largely upbeat in the stock market last year with an annual gain of roughly 45%. At the time of writing, it is valued at £490 million and has a price to earnings ratio of 238.55.
Senior Vice President Jeetu Patel of Cisco commented on the news on Monday and said:
“A great customer relationship is built on consistently enjoyable interactions where every touchpoint on every channel is an opportunity for businesses to deliver rich, engaging and intuitive experiences.”
ServiceNow to buy Canadian startup Element AI Inc
Cisco’s agreement with IMImobile is the latest in a series of acquisitions from technology companies that are increasingly focusing on improving their AI capabilities. Santa Clara-based ServiceNow Inc. also said last week that it will buy Element AI Inc. (Canadian startup). It was the fourth AI-related acquisition for ServiceNow in 2020.
On a year to date basis, Cisco shares are currently a little under 10% down in the stock market despite a roughly 30% recovery in its stock since March. At the time of writing, the American multinational technology conglomerate is valued at £141.45 billion and has a price to earnings ratio of 18.02.