Press Release (ePRNews.com) - UXBRIDGE, England - Feb 16, 2017 - Sapiens International Corporation, a leading global provider of software solutions for the insurance industry, with a growing presence in the financial services sector, announced today that it has entered into a definitive agreement (subject to customary closing conditions) to acquire privately held StoneRiver, Inc., for approximately $102 million in cash (subject to certain adjustments). StoneRiver delivers a wide range of solutions and services for the insurance industry in North America.
Headquartered in Denver, Colorado, StoneRiver’s versatile product portfolio is comprised of a policy administration suite, rating, underwriting, illustrations, reinsurance, and finance & compliance solutions for all major insurance business lines, across both property and casualty (P&C) and life and annuities (L&A). StoneRiver’s rich set of solutions complements Sapiens’ existing offerings, and will allow Sapiens to accelerate its growth in the U.S. market and globally. StoneRiver currently services more than 200 U.S. insurance customers, and has a team of approximately 500 insurance professionals.
“Joining forces with StoneRiver significantly expands Sapiens’ presence and scale in the North American insurance industry, and specifically helps us further accelerate our growing market footprint in the U.S. P&C space,” said Roni Al-Dor, Sapiens International Corporation (http://www.sapiens.com/) president and CEO. “Moreover, the deal is closely aligned with our M&A growth strategy that is centered on three key factors: growing our customer base, expanding geographically and adding complementary solutions to our portfolio – all while we ensure our continued high quality of services and product delivery. StoneRiver is an acquisition that meets all of our criteria. In the past six years Sapiens completed and integrated successfully eight acquisitions”.
Al-Dor continued, “Sapiens is confident that with StoneRiver, we strengthen our position as a leading innovative global software solutions provider, offering end-to-end solutions to the global insurance industry. We look forward to welcoming the StoneRiver team and combining best practices and capabilities, which will create greater value for our mutual customers and shareholders.”
Donald Light, Director in Celent’s North America Property/Casualty Practice, commented, “The continuing wave of insurance technology M&A activity demonstrates how insurance companies value working with providers who offer a full suite of solutions. Sapiens’ acquisition of StoneRiver is a major step forward in its global growth. This acquisition broadens and deepens Sapiens’ ability to enable US insurers as they continue their digital and modernization journeys.”
The acquisition of StoneRiver expands Sapiens’ North American P&C portfolio with StreamSuite™, a state-of-the-art insurance suite targeting the higher tier carriers, complementing Sapiens’ Stingray solution that is targeting the lower tier in the sector. The company will also gain entry into the workers’ compensation sector, a new area for Sapiens. Combining Sapiens’ and StoneRiver’s reinsurance solutions is expected to create a comprehensive market offering and will allow Sapiens to better serve its customers.
StoneRiver estimated Non-GAAP full year 2016 revenues are $80 million and the company is profitable. Sapiens’ management expects this transaction to be accretive to earnings starting with the third quarter of 2017. The transaction is expected to be completed by the end of the first quarter of 2017. Upon completion, StoneRiver will become wholly owned by Sapiens.
Sapiens will provide full-year 2017 guidance for the combined organizations when reporting 2016 annual results at the end of February 2017.
Some of the statements in this press release may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities and Exchange Act of 1934 and the United States Private Securities Litigation Reform Act of 1995. Words such as “will,” “expects,” “believes” and similar expressions are used to identify these forward-looking statements (although not all forward-looking statements include such words). These forward-looking statements, which may include, without limitation, projections regarding our future performance and financial condition, are made on the basis of management’s current views and assumptions with respect to future events. Any forward-looking statement is not a guarantee of future performance and actual results could differ materially from those contained in the forward-looking statement.
These statements speak only as of the date they were made, and we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. We operate in a changing environment. New risks emerge from time to time and it is not possible for us to predict all risks that may affect us. For more information regarding these risks and uncertainties, as well as certain additional risks that we face, please refer to the Risk Factors detailed in Item 3 of Part III of our Annual Report on Form 20-F for the year ended December 31, 2016, and subsequent reports and registration statements filed periodically with the Securities and Exchange Commission.
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