Taleo targets Europe, acquires Jobpartners

Contact: Ben Kolada

In its first acquisition outside North America, Dublin, California-based Taleo announced today that it is buying European HCM vendor Jobpartners for €26m ($38m). While the price is a fraction of the $145m in cash that Taleo held at the end of March, it’s a fairly rich value for what we understand was a struggling company. We expect that Jobpartners’ wide European reach was the primary influencer for the company’s valuation, particularly since Taleo’s competitors are also looking to expand internationally.

Taleo is paying €26m in cash for Jobpartners and expects to close the deal in its third quarter. That price should be considered plentiful since we understand that the target was burning through cash (at least €36m in VC equity financing, by our tally) and that its revenue was likely in decline. Taleo hasn’t provided full-year revenue for Jobpartners, but expects the target to generate $2-3m in GAAP revenue from the date the deal closes to the end of the year. Annualizing that number would put Jobpartners’ full-year 2011 revenue at about $8-10m, or roughly €5-6m based on current conversion rates. That’s a nearly 50% decline from 2005, when the company issued a press release saying that its fiscal-year revenue hit €8m. We’ll have a longer report on this transaction in tomorrow’s Daily 451.