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CGI Plans $2.7B Buy Of UK IT Firm Logica

CGI Group Inc. (NYSE: GIB) plans to acquire England-based information technology firm Logica for nearly $2.7 billion cash, the company announced Thursday.

CGI intends to close the acquisition by September and expects the acquisition to increase its earnings per share by between 25 and 30 percent, excluding acquisition-related and integration costs.

Logica provides business consulting, systems integration and outsourcing to clients around the world, including many of Europe’s largest businesses

The transaction will be funded through a combination of revenue streams including $971 million worth of subscription receipts exchangeable into new Class A shares.

Nearly $1.8 billion in debt funding will come from the Canadian Imperial Bank of Commerce, the National Bank of Canada and the Toronto-Dominion Bank.

CGI will also draw approximately $650 million from its existing credit facility and assume Logica’s estimated net debt of $500 million.

Logica shareholders will receive details about the acquisition within 28 days.

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