The Straker Translations Ltd (ASX: STG) share price is on a sharp rebound for the beginning of 2022. This comes after the company announced an acquisition to expand its presence in the multi-billion-dollar European translation market.
At the time of writing, Straker shares are zipping 8.71% higher to $1.685 apiece.
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Straker to acquire IDEST
Investors are fighting to get a hold of the Straker share price after the company revealed its latest move.
According to this morning's release, Straker advised it plans to purchase traditional translation provider, IDEST.
Based in Belgium, IDEST specialises in serving international institutions such as the United Nations and European Commission. Notably, the company has been supplying its services to these organisations for more than two decades.
The binding agreement will see Straker acquire IDEST shares for an initial consideration of €1.75 million (A$2.75 million). This will comprise €1.5 million (A$2.36 million) in cash and €250,000 (A$392,000) in shares at transaction completion. Straker shares will be at an issue price of $1.48 per ordinary share.
In addition, Straker will pay a deferred consideration to IDEST's vendors of up to €2.5million (A$3.93 million) in cash over two years. However, this is provided that the newly-acquired business meets revenue growth targets that have been set out.
Straker highlighted that buying IDEST opens the largest translation market in Europe through its established relationships with leading global institutions.
Straker CEO, Grant Straker touched on the company's latest deal, saying:
We have been talking to IDEST for several years as we recognised the strong standing, they have with global institutions and that their long experience and our technology solutions and global reach would be of value to their customers.
It's fantastic that the stars have aligned to enable this transaction and for us to build on the great work of the founders over the past 30 years.
We have recently setup an office in Amsterdam and combined with IDEST in Brussels will give us a very strong offering in the Benelux region.
Straker share price summary
Over the past 12 months, the Straker share price is up 16%, with these gains coming from the last week. The company's shares have noticeably been treading higher since 23 December.
Based on valuation grounds, Straker commands a market capitalisation of roughly $113.76 million, with 67.51 million shares outstanding.
