Agilysys Buys Hospitality POS Partner InfoGenesis for $90 Million
June 11, 2007 Timothy Prickett Morgan
System i reseller Agilysys, which also sells application software for hotel, lodging, and other hospitality businesses, has shelled out $90 million in cash to buy InfoGenesis, a partner of its own and other ERP software suppliers that creates point-of-sale software.
InfoGenesis is based in Santa Barbara, California, and had about $42 million in the prior 12 months, which means Agilysys is paying a very respectable premium for the company based on a deal-to-revenue ratio. InfoGenesis is a private company, so its full financials are not available, but given that Agilysys is a public company traded on the Nasdaq market, it may eventually provide some insight into the profitability of its most recent acquisition. The company had $7 million in profits against that $42 million in sales, but this is earnings before interest, taxes, depreciation, and amortization, or EBITDA. Presumably, such a multiple was necessary because InfoGenesis would be an attractive takeover target for other players in the ERP space where POS gear matters. InfoGenesis sells its POS products into casinos, hotels, resorts, cruise lines, stadiums, and restaurants.
InfoGenesis has 170 employees, who work in its California headquarters and at its customer support center in Las Vegas.
The money for this and several other acquisitions came from the $485 million sales of Agilysys’ IT distribution business to Arrow Electronics in January of this year.