Sage buys stake in Spanish company

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The Independent Online
SAGE GROUP, one of Britain's bigger suppliers of business and accounting software, is continuing its advance on continental Europe with the acquisition of a 20 per cent stake in Extra, a Spanish software company, for pounds 188,000.

The deal is Sage's fourth acquisition in just over a year and its second on the Continent. 'We will continue looking for companies in Europe,' said Paul Walker, chief executive.

He said Sage was trying to identify targets with a strong brand and distribution network in fragmented markets such as Spain and Germany. The group had cash balances of pounds 4.2m at its 30 September year- end.

Mr Walker added: 'Extra has a business profile and culture similar to our own.

'However, it is at a much earlier stage of development.'

The use of personal computers, Sage's target market, is less advanced in Spain than it is in Britain.

Extra had sales of about pounds 500,000 in the year to December with profits of pounds 50,000. Sage has the option to increase its stake to 70 per cent by early 1996 for a price capped at pounds 3.8m.

Mr Walker said: 'We have started out with a small stake so that we can start to develop the business without always looking at the bottom line from a City point of view.'

Sage's share price has been on a roller-coaster due to a profits warning in July arising from problems in its US business.

The shares, which peaked at 619p in April and bottomed at 367p in September, closed 1p up yesterday at 520p.