Charlotte, NC; December 31, 2009 — DecisionPoint International, a global leader in M&A advisory services for middle-market technology companies, announced today that its client, Edgewater Technology, Inc. (NASDAQ: EDGW, “Edgewater” or “Company”), a technology management consulting firm specializing in providing specialty IT services, has acquired Alabama-based Fullscope, Inc. (“Fullscope”), an award-winning Microsoft Dynamics consulting firm. Fullscope’s operating results will be combined with those of Edgewater’s beginning on January 1, 2010 and the transaction is expected to be accretive to earnings per share in 2010.
Known for providing discrete and process manufacturing Enterprise Resource Planning-related (“ERP”) consulting services in the upper mid-market, Fullscope has garnered several prestigious awards in the Microsoft Dynamics space:
2009 Microsoft Dynamics Manufacturing Partner of the Year
2009 Microsoft Dynamics Reseller of the Year Award for the United States
2008 Microsoft Partner of the Year for Microsoft Dynamics AX
2007 Microsoft Partner of the Year for Microsoft Dynamics AX
“Russell Smith, John Scandar and the entire Fullscope team are a great addition to the Edgewater family,” commented Shirley Singleton, Edgewater’s Chairman, President and Chief Executive Officer. “Fullscope extends the reach of our strategic data and analytics offerings into the upper middle market. We see tremendous opportunity in this market segment from a combination of updating and upgrading existing ERP platforms, many of which have been untouched since the 1999-2000 timeframe, and implementing the same Enterprise Performance Management (“EPM”) capabilities we have been providing to the Global 2000.”
Fullscope provides technology consulting services and software as a National Systems Integrator with Microsoft throughout the United States and Canada. Its solutions are targeted at improving operational efficiencies, increasing the speed and flexibility of manufacturing operations and providing real-time insight into production processes. Fullscope has delivered its services to organizations across various vertical markets including Manufacturing, Consumer Packaged Goods and Life Sciences.
“We are excited about the opportunity to combine our resources and expertise with those of Edgewater,” stated Russell Smith, Fullscope’s President and Chief Executive Officer. “Our Microsoft Dynamics AX platform and service offerings balance well within the other product-based software stacks currently being serviced by Edgewater. We look forward to capitalizing on our combined strengths to offer tremendous insight and value to customers.”
On June 25, 2009, Fullscope sold to Microsoft Corporation (“Microsoft”) two software product add-on modules to Microsoft Dynamics AX 2009 (the “Process Development Business Unit”). That transaction includes provisions for payments to be made by Microsoft to Fullscope through June 25, 2011 and for several support-related statements of work to be performed by Fullscope and funded by Microsoft through various dates ending in August 2011 (collectively referred to as the “Process Development Business Unit Payments”).
Excluding the Process Development Business Unit, Fullscope generated approximately $12.6 million in annualized service revenue and $9.1 million of software resale revenue in the most recent twelve-month period. Under the terms of the merger agreement, Fullscope shareholders will receive total upfront cash consideration of $12.5 million, subject to net working capital adjustments to be calculated post-closing. In addition, the transaction includes an earnout agreement under which positive net income, if any, generated by Fullscope from the Process Development Business Unit Payments will be passed through and paid to the former Fullscope stockholders. It is anticipated that the Process Development Business Unit Payments will be in the range of $2.0 million to $2.5 million.
About Edgewater Technology, Inc.
Edgewater Technology, Inc. is an innovative technology management consulting firm. Edgewater provides a unique blend of premium IT services by leveraging its proven industry expertise in strategy, technology and corporate performance management. Headquartered in Wakefield, MA, Edgewater goes to market by vertical industry and provides its clients with a wide range of business and technology offerings. For further information, visit www.edgewater.com.
About Fullscope, Inc.
Fullscope is an award-winning Microsoft Gold Certified Partner that focuses solely on Microsoft Dynamics AX enterprise manufacturing software. Microsoft Dynamics AX offers strong, out-of-the-box manufacturing planning application functionality, but more importantly, its underlying technology is extremely flexible. When necessary, Fullscope can easily tailor the product and apply additional industry-specific process and discrete knowledge gained from previous implementations. For further information, visit www.fullscope.com.
DecisionPoint is a global leader in M&A advisory services for middle-market technology companies in the services, software, and communication sectors. For additional information on DecisionPoint, visit www.DecisionPointINT.com.
For further information, contact: Doug Ellis, Managing Partner; (704) 916-9070; DEllis@DecisionPointINT.com.