Millennium Post

Majesco set to merge with US Cover-All Tech; scrip soars 20%

Majesco, a wholly owned subsidiary of IT solutions firm Mastek, will merge with NYSE-listed Cover-All Technologies to tap into the insurance technology space globally. The combined entity, with over $100 million in estimated annual revenue, will retain the Majesco brand, a statement said.

Reacting to the merger, Mastek stock rallied 19.99 per cent to settle at Rs 324.80 — its upper circuit limit at the BSE. At the NSE, it soared 20 per cent to Rs 325.20. The market valuation of the company climbed Rs 124 crore to Rs 726.90 crore. Majesco (formerly, MajescoMastek) has entered into a definitive merger agreement with Cover-All Technologies Inc in a 100 per cent stock-for-stock transaction, Mastek said in a filing to the BSE.

The transaction is expected to close in the second quarter of 2015. Both companies will continue to operate as independent entities until then. Majesco (formerly, MajescoMastek) provides core insurance systems and services to approximately 100 insurance carriers worldwide, while Cover-All Technologies is an insurance software company. "Cover-All's stockholders and the holders of its options and restricted stock units, in the aggregate, will upon the closing of the merger, receive 16.5 per cent of the outstanding shares of common stock of the combined company, on a fully diluted basis," it said.

The decision to merge the two businesses is the latest step in the execution of Majesco's aggressive growth strategy to consolidate its global insurance business under a single and separate entity, it added.

Last week, Majesco had signed a definitive agreement to acquire the insurance business of Agile Technologies, bringing additional IT consulting, data strategy and implementation expertise to Majesco.

PTI

PTI

Our contributor helps bringing the latest updates to you


Share it
Top