NEWRY-BASED First Derivatives has acquired an Australian technology company, Lepton Solutions, in a cash and shares deal valued at up to 3.6 million Australian dollars (€1.9 million).

The Adelaide-headquartered company, which was set up five years ago, specialises in risk management and stock exchange trading software. It has devised software currently in use in several hundred financial institutions and corporate treasuries worldwide. A stock exchange trading system which it also developed is now owned by Nasdaq.

Under the terms of the deal, First Derivatives will pay an initial cash payment of A$1 million for the company which trades under the name Hologram. The four principals, who own more than 96 per cent of the business, will also receive 400,000 share options in First Derivatives.

This represents 2.9 per of the company’s issued share capital. First Derivative shares are currently trading at 169.5 pence sterling (A$3.49). The vesting of the share options is subject to Hologram and its principals achieving certain sales targets over the next three years. The four individuals will also receive deferred payment of up to A$1.2 million in cash.

First Derivatives, which was set up 12 years ago, provides specialist financial software and consultancy services to the capital markets industry. The Hologram deal is the second major acquisition for the Newry company, which is jointly listed on London’s Alternative Investment Market and the Irish Stock Exchange, in less than eight months. Last year it acquired a US technology marketing firm in a cash and shares deal which could be worth more than £11 million.

First Derivatives’s acquisition of Market Resource Partners strengthened its presence in the North America market and helped it win new contracts worth several million dollars.

Brian Conlon, the Newry company’s chief executive, believes its latest acquisition will create new business opportunities for it in Asia Pacific. He said there was a lot of interest in the products and services First Derivatives had to offer from potential customers in the Asia-Pacific market. “The Hologram principals have a track record of developing and marketing enterprise software in our domain and this expertise adds to our team of world class technology professionals,” Mr Conlon said.