US-based CIBER Inc has put its acquisition of Bangalore-based Iteamic Pvt Ltd on a hold. The deal was stuck in mid-September and was expected to be closed in a month. The deal involved giving shares of CIBER to Iteamic, but as the share price of CIBER has fallen to nearly half of what it was when the deal was struck. The company does not want to issue equity shares at this point of time. It has also put on hold a business combination in Europe that it was working on.
CIBER said in a statement - "The Company's bank credit agreement requires at this point that the Company issue shares as consideration for any acquisition. While the bank group has consented to these business combinations, the Company is not currently willing to issue the equity given the state of recent equity market turmoil; hence, both deals remain pending."
CIBER's shares closed at $4.78 on Monday, a 43% fall from a high of $8.43 posted on Sept 4.
CIBER, a global system integration consultancy firm, had been winning a lot of deals and wanted to expand its offshore facility with acquisition of Iteamic. The Bangalore-based firm has more than 200 employees and expects to do $7-8 million in revenue in this fiscal year. Iteamic was formed in 2003 and last year raised Rs 5 crore ($1.25 million) from Canbank Venture Capital Fund Ltd.