Mobile Reach Technologies is acquired RTP-based Trifolium in an all-stock deal worth some $700,000.
Trifolium, which was founded in 1996, is a developer of enterprise software solutions. It is profitable, producing estimated profits of $150,000 this year on revenues of $2.4 million. Mobile reach said in a statement it expected Trifolium to generate $3 million in revenues in 2005.
Mobile Reach (OTC BB: MBRI) agreed to a purchase price of 3.5 million shares of its stock. It traded at 3 cents on Tuesday but rose to 6 cents before trading closed. It has a 52-week high of 65 cents.
The companies said the value of the stock would be calculated next summer and more shares would be issued if necessary in order to total $700,000 up to an additional 3.5 million shares. The deal is expected to close by Nov. 30.
Mobile Reach said the combination of the two companies would enable “rapid development and delivery of the next generation of mobility solutions.”
“We believe that our capabilities complement each other very well and our shared expertise in the financial services, healthcare, telecommunication and retail verticals gives the newly combined company significant new opportunity in these markets,” said Christopher Johnson, the new CEO of Mobile Reach. Johnson joined the firm in August.
Willard Ruchte, the founder and CEO of Trifolium, added that “joining Mobile Reach will provide us the additional resources required to aggressively expand our business in the mobile solution space and increase revenues even more rapidly.”
Trifolium is to operate as a wholly owned subsidiary. It is an BM Premier Business Partner with an emphasis on WebSphere, DB2, Lotus and other web service technologies.
Trifolium joined Mobile Reach’s alliance program earlier this year.
Stanton Walker & Company was retained by Mobile Reach earlier this year to explore possible mergers and acquisitions and participated in the negotiations with Trifolium, Mobile Reach said.
Mobile Reach: www.mobilereach.com