Don’t be suspicious of Nucleus/ Adera deal

Jim Surguy raises some interesting points on corporate vanity (Letters, DW 13 October). Company valuation can depend on a lot of “goodwill”, particularly in the consulting sector, and I’m sure Surguy’s assertion that many press reports inflate transaction values for the benefit of corporate ego is also true. But in the Nucleus/ Adera case, his suspicion is misplaced.

We clearly reported in a joint press release that Adera had acquired Nucleus for £8m, plus an extra £2m maximum to be paid at the end of the “earnout” period. Both parties agreed it a fair valuation, and reflected an appropriate premium for acquiring Nucleus’ unique mix of strategy, branding and technical capabilities.

Despite Surguy’s comments to the contrary, this is in itself evidence that good multiples are still being paid for top-quality consultancies in the e-business sector. He’ll be even more surprised to know the Adera offer was by no means the largest on the table.

This all shows two things: there is still huge value in developing highly differentiated consulting skills; and regarding Nucleus/ Adera, things really are what they seem (even the money aspects).

Peter Matthews

Managing director

Nucleus

pmatthews@nucleus.co.uk

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