Information technology research and advisory company Gartner Inc. is acquiring technology and insights firm CEB for approximately $2.6 billion in cash and stock. The deal, which has been approved by the boards of both companies, is expected to close in the first half of the year.
Under the terms of the agreement, Arlington, Virginia-based CEB shareholders will receive $54 in cash and 0.2284 shares of Gartner common stock for each share of CEB common stock they own.
The transaction has a total enterprise value of approximately $3.3 billion, including Stamford-based Gartner”™s assumption of approximately $700 million in CEB net debt.
Gartner expects to achieve annual savings of about $25 million to $50 million, beginning in 2018. In the long term, Gartner is looking to produce double-digit growth in revenue, earnings and free cash flow while maintaining a strong balance sheet and liquidity.
On a pro forma basis, the combined company”™s reported results for the last 12 months ended Sept. 30, 2016 include approximately $3.3 billion in revenue, $693 million in adjusted earnings before interest, taxes depreciation and amortization, and $463 million in free cash flow. Together, Gartner and CEB will employ more than 13,000 associates serving clients in more than 100 countries.
“We expect this acquisition to create value for our shareholders in both the near and long-term, including immediate accretion on an adjusted EPS basis,” Gartner CEO Gene Hall said. “Associates will benefit from expanded career opportunities as part of a larger, strong organization with the most extensive client offering in the industry.”
