Irish software company Cúram acquired by IBM
Cúram Software (Dublin, Ireland) has been acquired by IBM. No financial details of the transaction were released.
Cúram Software is an Independent Software Vendor providing software to help government agencies administer social welfare and health services. The company reported revenues of $79.8 million (€59.2 million) in 2010, down from $91.2 million in 2009. CEO and co-founder John Hearne said the company is expecting revenues in the range of $100 million for 2011. Based on these figures the deal may have been worth at least $150 million as software companies like Cúram are being valued at 1½-2½ times their revenues. Cúram made a pretax profit of $8.2 million last year. The company employs 700 staff globally.
Cúram customers include Britain’s department of work and pensions; the US states of Utah, Louisiana and North Carolina; the city of New York; and five of the 10 provinces in Canada.
“This is avery exciting day for us. Our software will now be available in 170 countries rather than the nine in which we are currently active. We always ruled out an IPO as it’s not suitable for our kind of business and we weren’t interested. We have seen “serious interest” from potential buyers since 2005, but we preferred continuing with IBM due to its commitment to “market and use our products in an interesting way”.
All Cúram’s senior management are staying on after the sale closes, including Mr Hearne and his co-founder Ronan Rooney, who has the role of chief technology officer.
The acquisition is “substantial news” for both IBM and Cúram, said Craig Hayman, general manager of IBM’s industry solutions group. He said Cúram would be integrated into IBM’s “Smarter Cities” initiative, which he said aims to help governments run urban areas more efficiently and get better results for citizens.
IBM was attracted by the “unique characteristics” of Cúram, which include its alignment with IBM’s strategy, the capabilities of its products, and the talent working at the firm, which Mr Hayman said was “world-class”.
In 2000, IBM provided loans of $4.1 million to Cúram, then known as IT Design, to facilitate its entry into the US market, but this has since been repaid. The deal will see IBM’s software division expand significantly when the almost 300 local Cúram staff are added to the 1,000 IBM staff already working on software here.
Backers of Cúram include State agency Enterprise Ireland and US firm Fidelity Investments which invested $10 million in late 2002.
Source: The Irish Times