Nasdaq-listed Ebix, through one of its Indian subsidiaries, has agreed to acquire Mumbai-based Miles Software for about $19 million. The deal, which includes an additional contingent earn-out of up to $8.5 million payable after two years, will see all key executives of Miles, including co-founder Milan Ganatra, join Ebix, a release from the company said. Ganatra will be a part of the senior leadership team of EbixCash, the statement said.
Post the acquisition, Miles software will serve as Ebix’s investment, wealth and asset management division, with all its products integrated across EbixCash financial exchanges and EbixExchange insurance exchanges over the next six months, the statement added. Consequently, Ebix believes their business can continue to grow at the rate of more than 20% per annum, with operating margins of 30% or more, after Miles’ products are integrated with the company.
Founded in 1999 by Milan Ganatra, Dhawal Kamath, and Himanshu Siria, Miles Software develops wealth and asset management software. The firm claims to have customers in various sectors including banking and financial institutions, asset management organisations, brokerage firms, and family offices across 18 different countries in Europe, Middle East and Southeast Asia. In the financial year ended 2017, Miles claims to have generated revenues of $8 million.
On the other hand, for Ebix, which operates in segments like software, e-commerce services, insurance, financial, healthcare and e-learning, the deal is a part of the aggressive acquisition strategy it employs in India, having made 11 acquisitions in the last few years. The company plans to invest another $500 Mn for acquisitions in India, according to its chairman Robin Raina.
It is worth noting that the development comes shortly after a Moneycontrol reported that the Goods and Services Tax (GST) department has conducted searches at Ebix’s Mumbai office. According to the report, the searches revealed in information on transactions on which taxes up to Rs 20 crore may have been evaded.
Ebix’s presence in India
- It bought two Indian companies in luxury travel space — Mercury Travels , and Leisure Corp — for a cumulative amount of approximately $14.2 million, to create a new travel division, called Mercury.
- In July, Ebix acquired Pune-Based Indus Software Technologies, for approximately $29 million including $5 million of contingent earn out.
- Early this year, Ebix bought its fourth money transfer company in India- Money Transfer Service Scheme (MTSS) business of Transcorp International Limited for $7.4 million. Earlier, it had bought Paul Merchants, YouFirst Money Express Private Limited and Wall Street Finance Limited.
- In November 2017, Ebix had acquired Indian online travel agent (OTA) Via.com for approximately $74.9 million to enter the travel segment.
- In November 2017, Ebix also entered into a joint venture with Vara Technology to target IT & BPO Outsourcing in the Financial & Insurance Sector in India.
- Ebix signed a memorandum of understanding (MoU) with the Bombay Stock Exchange (BSE) for setting up an insurance distribution network in the country in October 2017.
- The group acquired 80% stake in digital wallet company, ItzCash for Rs 800 crore in May 2017. It was later renames ad EbixCash.