Serenic Corp. reports planned sale to Sylogist, attributes 2014 losses to early stages of cloud strategy

Canadian-based software and services firm Sylogist Ltd. has entered into a definitive agreement to acquire Serenic Corporation and its subsidiaries. The deal includes Serenic's existing proprietary enterprise application software, all existing customer relationships, customer contracts, Microsoft and other third party agreements.

Serenic is a Canada-based provider of financial and business management software  to non-governmental organizations (NGOs), and the public sector based on Microsoft Dynamics NAV.

Sylogist will pay approximately $7.35 million in cash and assume Serenic's $3.5 million working capital liabilities, which mainly reflect deferred revenues.

Sylogist is acquiring all rights to the Serenic brand. Serenic has formed a new operating division called 'Cloudco' that will retain the Serenic Operating Companies' (SOC's) existing intellectual property associated with Serenic's cloud technology. Cloudco technology enables software applications based on Dynamics NAV and CRM platforms to be optimized for use on Microsoft's new cloud technology platform.

"Sylogist will grant a royalty bearing OEM license involving certain of the SOC's products to Cloudco," according to a statement. "Cloudco will re-brand and market these solutions to new customers that the SOCs have not historically pursued. The parties intend to work non-competitively to pursue new volume markets for mutual benefit."

The deal is expected to close on July 25, 2014.

Serenic also announced its quarterly earnings, which showed dropping revenue and profits, which the company attributes to its push to the new cloud business that Cloudco will presumably continue to manage. Revenue at Serenic decreased 6.1 percent to $11.33 million (Canadian dollars) and a net loss of $2.05 million, compared to revenue and net profit, respectively, of $12.07 million and $39,110 in 2013.

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