Cimatron acquired Gibbs for $5M in cash and $4.5M in stock. That's about 75% of revenue, or about 7x income. Gibbs and Cimatron have suprisingly little overlap in their customer base.
The combined company has a current market capitalization of about $22M on a combined $30M revenue stream. When compared with most stocks on the Cyon Research Index, this is quite low. But Delcam, a direct compare for Cimatron, has a market capitalization of $45M on sales of about $60M. So the question to ask is: why are pure-play stocks in this sector so poorly valued?
1 comment(s) so far...
By Mike on
Re: Cimatron acquires Gibbs
The combined companies will have over $40 million in revenues and probably closer to $45 million this year.
CIMT's value based upon Market Value as a percentage of revenues has been increasing over the last year.
What will happen in 2008 and forward?
We will see.