BluePhoenix has been shifting its focus overseas and selling off its non-core business.
Software conversion company BluePhoenix Solutions Ltd. (Nasdaq: BPHX) has shifted its focus to outside Israel in recent years, being delisted from the Tel Aviv Stock Exchange (TASE) and significantly cutting its staff in Israel. The Israeli section of the company will soon become even smaller, following a merger with a US company.
BluePhoenix, whose Nasdaq market cap is $42 million, is merging with Ateras Sophisticated Business Systems in a share deal.
BluePhoenix’s shareholders will convene in Seattle on November 18 in order to approve the deal. As part of the deal, BluePhoenix will issue 6.2 million shares worth $22.7 million, constituting a third of its capital, to Ateras’s current shareholders in exchange for the latter’s entire capital.
Figures published by the company last week show that on a pro forma basis, the two merging companies had an aggregate $14.3 million in revenue and a $264, 000 operating loss in 2013. BluePhoenix reported $8.5 million in revenue and a $3 million operating loss in 2013.
Founded in 1987, BluePhoenix was formerly controlled by Formula Systems Ltd. (Nasdaq: FORTY; TASE: FORT), which sold control of the company to several foreign investment concerns for $140 million. The company has experienced financial difficulties in recent years, and sold part of its activity in order to focus on its core business and cut expenses.
Published by Globes [online], Israel business news – www.globes-online.com