Gartner, Inc., a leading provider of research and analysis on the global information technology industry, and META Group, Inc., a premier information technology research and consulting firm, announced that the companies have reached an agreement under which Gartner will acquire META Group in an all-cash transaction valued at $10.00 per share, or approximately $162 million. The boards of directors of both companies have unanimously approved the agreement.
In 2003, Gartner generated $858 million in revenue from 76 locations around the world, while META Group generated $122 million in revenue from 52 locations. The acquisition of META Group will bring valuable additional dimensions to Gartner's already strong core research capabilities. Moreover, the addition of a sales team from META Group that is already highly conversant in Gartner's product and service offerings will enhance Gartner's ability to grow sales going forward. The combination will also drive operational efficiency given the complementary nature of the two companies.
Gene Hall, Gartner's chief executive officer, said, "Gartner and META Group are both based in Stamford and share complementary business models, which will allow easy integration of META Group's offerings into Gartner's existing service portfolio. This transaction is an exciting opportunity that will give us increased depth in key sectors, geographies and markets, and an increased ability to seize revenue opportunities with the addition of META Group's well-trained, successful sales force. In sum, the acquisition will make Gartner a stronger company with increased opportunities for growth and greater resources to offer clients."
Gayl Doster, co-chairman of the Special Committee of the Board of Directors of META Group, said, "Through this acquisition, both META Group and Gartner clients will have access to greater depth and breadth of expertise to help them meet their business goals as efficiently and effectively as possible. We look forward to working with Gene and the rest of the team at Gartner to ensure a successful completion of the transaction and subsequent integration of the META Group business."
Gartner intends to finance the acquisition through the use of current cash, as well as borrowings under the Company's existing line of credit.
Gartner does not expect the transaction to have a material impact on its 2005 operating results, excluding charges related to the integration of META Group, but expects it to be meaningfully accretive thereafter. The Company will provide additional information on the financial impact of the transaction, as well as 2005 guidance for Gartner on its 2004 year-end earnings call scheduled for February 3, 2005.
The transaction is subject to customary closing conditions, including regulatory approvals, and approval by META Group's stockholders. The transaction is expected to close in the second quarter of 2005.
Perseus Group, the San Francisco-based investment bank, provided financial advice including a fairness opinion to Gartner's Board of Directors in connection with the transaction. Wachovia Capital Markets, LLC acted as exclusive financial advisor to the Special Committee of the Board of Directors of META Group, Inc.
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