French consultancy and outsourcing giant Capgemini has placed a $50m bid to acquire Ciber's North American business as the firm files for chapter 11 bankruptcy.
Ciber filed for chapter 11 bankruptcy with the United States Bankruptcy Court in the district of Delaware. The US-based SI has secured $45m in debtor-in-possession (DIP) financing, subject to bankruptcy court approval, which is expected to provide the company with liquidity to maintain its US operations throughout the chapter 11 process.
Ciber entered a "stalking horse" agreement with Capgemini on 9 April to sell all assets of the company in North America and India. The agreement means that bidders other than Capgemini are able to make competing bids, but the French firm is given the right to start the auctioning process. Capgemini will be entitled to reimbursement for expenses and fees if it does not win the bid.
Completing the acquisition will add 2,000 Ciber consultants - including 1,000 in India - to Capgemini's technology and engineering services brand called Sogeti. The addition of Ciber would grow Capgemini's Sogeti subsidiary by more than 50 per cent and make its US operations representative of 15 per cent of its overall business. Should Capgemini win the bidding process, the transaction is expected to close by the end of the 2017's second quarter.
CEO of Ciber Michael Boustridge said: "With the advice and support of outside advisors, we've explored multiple paths, including selling the company outside the bankruptcy process, selling certain assets of the company, and other transactions to restructure the balance sheet or raise capital, while also focusing on attempting to improve sales, reduce costs, and exit underperforming operations. After careful consideration of the alternatives available to maximise the value of the company, it's become clear that the best path forward for the company, its employees, customers and stakeholders is to accomplish a sale through the bankruptcy process.
"We are keenly focused on minimising disruption to our customers, partners, and employees during the chapter 11 process. The proposed sale will preserve jobs, ensure customers can benefit from continuity of services, and enable a smooth transition of Ciber's US business to Capgemini or any other bidder providing a higher and better offer in accordance with court approved procedures."
The deal comes soon after Ciber sold off its European business to various buyers throughout 2016 and 2017. The SI agreed to sell its German and Danish subsidiaries - as well as the majority of its French business - to Munich-based IT services firm Allgeier for $8.8m in February. Ciber also sold off its Dutch and Norwegian business to Manpower Group last year, and sold its Swedish subsidiary to services house Bouvet in September.
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