- 07 Jun 2022
- ICICIdirect Research
Cyient acquires Portugal based Celfinet
CYIENT - 1977 Change: -33.15 (-1.65 %)News: Cyient has entered into a definitive agreement to acquire Portugal based Celfinet. Incorporated in 2003, Celfinet is a wireless engineering service company focused on end to end network planning and performance optimization services. Cyient will acquire it at EUR41mn ( 2.4x price to sales), out of which 65% will be paid upfront while the rest 35% as earn out over the two years subject to business performance
Views: The acquisition is expected to strengthen Cyient’s wireless engineering practices to support communication service providers. The company is also expected to strengthen its presence in Europe through Celfinet. This is third acquisition by Cyient in YTD FY23, all three acquired entities are expected to contribute 20-21% to its revenues in FY23. Also EBIT margin profile for Cyient is expected to improve as both Celfinet and Citic has higher EBIT margins than Cyient’s reported margins of 13.9% in FY22. Successful integration of these acquisitions is the key
Impact: Positive