Alithya To Acquire Quebec's R3D Conseil For C$76M And Ink Commercial Agreements Worth C$600M

Strategy and digital transformation provider Alithya Group Inc ALYA inked an agreement to acquire Quebec’s digital solutions firm R3D Conseil.

• This transaction included annual minimum volume commitments of C$600 million in combined revenues during the initial 10-year term commercial agreements with Québecor and Beneva (via its subsidiary, La Capitale).
• R3D Conseil revenue amounted to C$63 million in FY20. The transaction is expected to drive Alithya’s profitability from the annual minimum volume commitments and value-added projects ensuing from the new commercial agreements.
• The purchase price, assessed at C$76 million (excluding the debt assumption of C$8.5 million), is payable via 25.5 million class A subordinate voting shares of Alithya to R3D Conseil shareholders representing 30% of Alithya’s shares.
• R3D Conseil’s two principal shareholders, Québecor and Beneva, would respectively hold about 11.9% and 11.9% of Alithya’s share capital and 6.7% and 6.7% of the voting rights attached to Alithya’s shares.
• Existing Alithya shareholder Investissement Québec’s interest would increase to 8.7% of Alithya’s share capital and 4.9% of the voting rights attached to Alithya’s shares.
• Alithya’s cash balance amounted to C$9.4 million as of December 31, 2020.
• Price action: ALYA shares traded higher by 28.4% at $3.03 in the premarket session on the last check Wednesday.