Benzinga | Mar 24, 2021 07:10AM EDT

Alithya To Acquire R3D Conseil; Transaction Includes Annual Minimum Volume Commitments Totallint $600M In Combined Revenues During Initial 10-Year Term Commercial Agreements

Alithya Group inc. (TSX:ALYA) (NASDAQ:ALYA) ("Alithya"), a strategy and digital transformation leader with more than 2,200 professionals in Canada, the United States and Europe, is pleased to announce that a definitive agreement has been reached for the acquisition of R3D Conseil, a private Quebec firm that specializes in digital solutions. This transaction includes annual minimum volume commitments totalling approximately C$600 million in combined revenues during the initial 10-year term commercial agreements with Qu?becor and Beneva (via its subsidiary, La Capitale), two of R3D Conseil's indirect principal shareholders.

In the framework of this important transaction, Alithya will:

* Welcome 600 experienced Quebec-based professionals from R3D Conseil; they specialize in consulting and digital application development in the areas of insurance, finance, government services, healthcare and telecommunications;

* Add a back log representing about C$600 million in revenue from value-added service agreements through to 2031 with Qu?becor and Beneva (created from the amalgamation of La Capitale and SSQ Assurance), to support them in their digital transformation projects in addition to many other clients of R3D Conseil;

* Create more than 350 new jobs in Quebec for digital transformation experts in the fields of insurance and telecommunications;

* Create a Quebec City-based global digital excellence centre for the insurance industry;

* Add Qu?becor and Beneva (via its subsidiary, La Capitale) as shareholders and business partners;

* See Investissement Qu?bec's stake increase to approximately 8.7% of Alithya's share capital.

Alithya expects this transformative transaction to generate significant growth. R3D Conseil's revenues were approximately C$63 million for the last twelve months ending on December 31, 2020. The transaction will make an immediate contribution to Alithya's profitability, notably due to the annual minimum volume commitments and value-added projects resulting from the new commercial agreements.