Parseq the new face of firm's reverse takeover

Rapidly-growing Documetric, based in Rotherham and founded in 2007, hopes to join the Alternative Investment Market (AIM) by end of the month.

Documetric specialises in payment processing and transactional services, and hopes combining its services with Intelligent Environments' online and mobile banking offering will create a compelling model.

The combined business will be given the new name Parseq – a name used in physics to denote the distance to a star.

Documetric chief executive and founder Rami Cassis will head the enlarged company, and along with his family's trust, will hold 35.5 per cent of the group. Documetric itself, of which Mr Cassis holds about 80 per cent, takes 53 per cent of the enlarged company.

"It's effectively a land grab of the supply chain," said Mr Cassis. "The key for us is to be able to provide a turnkey solution for clients."

The deal values Documetric at 13.8m, more than its 2009 revenues of 10.2m and pre-tax profits of 1.8m.

Subject to shareholder approval, the group hopes to be re-admitted to AIM on July 22 with a market capitalisation of 30.6m.

Intelligent Environments has also raised 4.5m through a placing of 64 million shares.

Mr Cassis, a former oil services engineer and KPMG consultant, said the deal will take Documetric "to the next level".

"We've been looking at a number of options," said Mr Cassis. "This was by far the most transformational for both of us.

"This is the most definitive way of saying we're committed to this transaction and we're going to make it work."

Documetric employs about 265 staff in Rotherham and Mr Cassis said the group's headquarters will be either in Yorkshire or London.

"We see this as a means of enabling Rotherham to grow," he said. "There are going to be other outsourcing services that we can deliver as part of the merger. This is nothing but good news for Rotherham."

Documetric, which started off as a loss-making business with about 15 clients, is now a leading UK payment processing firm. It processes the wages of about six per cent of the UK's workforce – about 24 million annual transactions worth more than 19bn.

Intelligent Environments joined AIM in 1996 and provides software and services to the online and mobile banking market. Its customers include HSBC and Halifax, and it supports brands including Orange, Argos and Sainsbury's. However, the company has suffered from lack of recurring revenue and scale, which has prevented it from growing in the online and mobile banking sector. The company, which last year made 860,000 pre-tax profits on revenues of 6.4m, launched a review early last year to look for partners.

Mr Cassis said the takeover will mean significant opportunities to cross-sell, as well as options to extend its services beyond financial services into utilities and the public sector.

Intelligent Environments' chief executive Phillip Blundell will become managing director of the new group. Its chairman Clive Richards said the deal will "dramatically transform our business and create a financially strong new entity with comprehensive outsourcing solutions, scale and market presence".

Shareholders will vote on the deal on July 21.

A guarantee of success

Rami Cassis founded Documetric in February 2007, buying a small data services business from IT outsourcer Atos Origin, whose UK division he headed for three years.

The business was turning over about 1.5m but losing about 200,000 a year. Mr Cassis was partially backed by business angels but mainly funded the acquisition by placing his "entire net worth on this in very significant personal guarantees".

In July 2008, Documetric bought a processing business from First Data International, for a total of 16.7m, which included 6m in cash and two freehold properties. Mr Cassis hails from Paris but has lived around the world. He has been shortlisted for the regional final of the Ernst & Young Entrepreneur of Year awards.