Situation
Equant Application Services ("EAS"), an Equant N.V. ("Equant") division, is a leading European provider of web-based applications and e-commerce integration services for the travel and transport sectors. Given the diverging business models between EAS and the rest of Equant's activities, and the increased emphasis on network services as a result of the Equant-Global One merger, EAS was no longer perceived as a strategic business within the Equant group. Therefore, in June 2001 Equant retained ARC Associates to sell EAS to a third party that could better exploit EAS's full potential and enhance growth and profitability.
Approach
ARC Associates prepared an executive summary, information memorandum and supporting valuation materials for discussions with potential acquirers. ARC Associates compiled and undertook a call programme and, once identified, managed discussions with the potential acquirers.
ARC Associates was actively involved in the negotiation of the terms of the transaction and co-ordinated discussions among the management teams, the legal teams and other advisers during the due diligence and documentation processes.
The Transaction
On 1 October 2001, SITA Information Networking Computing, N.V. announced it had acquired the Equant Application Services business unit from Equant. The division has 150 employees and had revenues of more than US$26 million in 2000. Financial terms of the transaction were not disclosed.