NCR to Buy Retalix for $650 Million
December 11, 2012 Alex Woodie
Retalix develops software that retail chains use to manage their business. The company’s lineup consists of merchandising, point of sale, supply chain, logistics, and marketing components. Many of the company’s offerings are Windows based, including its flagship Retalix 10 in-store management system. However, its Power Enterprise line, which is a distribution-focused ERP solution, runs on the IBM i platform. Some of its offerings are developed in Java.
Retalix says its software and services are deployed in more than 70,000 retail locations in more than 50 countries. The company, which is headquartered in Ra’anana, Israel, and has a US office in Plano, Texas, touts a number of prominent blue-chip retailers as customers, including Target, Woolworth’s, and Tesco. Retalix is a publicly traded company (NASDAQ) that has brought in revenues of about $200 million in each of the past five years. Last year, it reported $236 million in revenue and net income of $13.6 million.
Over the last five years, Retalix’s stock has moved conservatively between a low of $8 and a high of about $22 just prior to the acquisition announcement. The company’s balance sheet showed $264 million in total equity, and $0 in debt, which obviously played a role in NCR giving the company’s shareholders a 36 percent premium on its stock price.
NCR Chairman and CEO Bill Nuti had this to say about the deal: “Retalix is a strong, strategic fit for NCR and the combination of our two companies will drive significant value for both our shareholders and customers. Retalix’s market-leading software and services capabilities will enhance NCR’s retail solutions, creating a world-class portfolio of offerings. That innovation, plus the addition of exceptional talent to our team, positions NCR as the global leader in retail innovation.”
The acquisition is subject to the customary closing conditions, including approval of Retalix shareholders, and is expected to close in early 2013.