Infobank sells cash-cow in MBO
Software reseller sold to management for £6.25m
Infobank International Holdings is offloading its software business with a loss of around £2 million in an MBO. The UK reseller today said it would sell Internet Software Corporation for £6.5 million in an internal takeover headed by the division's founder and MD Paul Ridley. Payment will be £3 million cash, £2 million in unsecured loan notes and a pre-completion dividend of £1.5 million. Infobank may also get an additional sum if Software Corporation or Ever 1129 – the buy-out vehicle - decide to float. In June 1997, Berkshire-based Infobank bought the Software Corporation division for £8.25 million. Software Corporation was never a central plank of Infobank's business but acted as a much needed cash-cow while the company needed an additional revenue stream. The company said the agreement, which is subject to shareholder approval at the company's AGM on 16 December, will make Infobank solely an ecommerce business. It plans to pour all its investment into InTrade - its business-to-business ecommerce service. "In order to concentrate all of the Group's resources on the development of InTrade, the board has carried out a programme during 1999 for the disposal of the non-core businesses," it said in a statement this morning. "The sale of Software Corporation substantially completes this process." Infobank's share price was up 147.5 pence at 1355 pence today. Infobank was founded in 1993 and floated on AIM in February 1997. ® Related items: Infobank seeks £9 million to develop e-commerce apps Infobank shareholders lack confidence
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