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Xansa - 130p bid from French IT Group

September 2007

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • XAN
  • Price:
  • 130p
Xansa surged by more than 70% after the company announced an agreed cash offer from French IT firm Groupe Steria. The offer at 130p a share values Xansa at £472m. Xansa's low-cost outsourcing facility in India is a valuable and rare asset and Steria is clearly paying full price for it although it expects to generate significant synergies (estimated at Eu24m) from combining the two businesses. The deal values Xansa on a FY07 PE of 25.6x and therefore looks a knockout bid and a level at which most private equity bidders are not going to compete. Tipped at 36p in October ‘02, accept the offer. Gain: 261%. ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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