Autonomy pays $775m for US software group Interwoven

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The Independent Online

The blue-chip technology group Autonomy is banking on a rise in companies turning to software to deal with legal challenges and increased regulation after it splashed out $775m (£559m) on the US group Interwoven.

The Cambridge-based firm announced yesterday it had agreed a $16.20-per share deal for Interwoven, which specialises in content management software for the legal sector. Autonomy shares closed up almost 4 per cent at 1,072p.

"The combination of the two companies will redefine how global 2000 corporations, leading law firms and government regulators will discover, analyse and manage information", it said in a statement. The deal was funded by $162m cash reserves, a share issue worth about $350m, and new debt of $200m.

Autonomy, run by Mike Lynch, specialises in software tracking "unstructured data" including emails, instant messages and voice calls. It announced a 51 per cent leap in full-year profits on Wednesday, and said the deal should boost earnings this year by 20 per cent.

Mohammed Moawalla, analyst at Goldman Sachs said the acquisition was a "good move" for Autonomy, as he backed Interwoven's content management technology and its client list. It has 4,600 customers worldwide, including 1,200 top law firms. Analysts at technology research group Megabuyte, said the acquisition had "moved the remarkable Autonomy story on another stage".