SGI Acquires SGI Japan, Ltd.

SGI has acquired all outstanding shares of SGI Japan, Ltd. from a consortium of investors that includes NEC Corporation, Sony Corporation and Canon Marketing Japan.  

The purchase price was $17.9M in an all cash deal.

The purchase also includes $27.0M of net working capital. SGI previously owned 10.4% of SGI Japan, Ltd.

This acquisition intends to serve as a strategic entry into the technical computing market of Japan. SGI expects that the transaction will accelerate growth opportunities in this important market. SGI Japan, Ltd. operates primarily as a sales and service organization within Japan.

The acquisition, which closed on March 9, 2011, is expected to add more than 400 customers in important vertical markets including government, manufacturing, telecommunications, media and education. In addition, with this acquisition, SGI is expected to add 272 employees with technical computing skills in Japan’s market.

"Japan is one of the world’s largest and most important technical computing markets," said SGI CEO Mark J. Barrenechea. "Today’s acquisition further extends our global reach as we seek high value ways to expand growth opportunities. We look forward to strengthening our relationships with employees, partners and customers of SGI Japan, Ltd."

"We expect this acquisition will be accretive to earnings in the current fiscal year and will help us achieve a revenue growth of 14% to 19% in FY11, and 15% to 20% in FY12, both on a non-GAAP basis," said Jim Wheat, SGI CFO.

Nobuhiko Nakatsu has been named President of SGI Japan. Mr. Nakatsu previously served as President and CEO of SGI Japan, Ltd.