Corporate Executive Board Co. (CEB), a leading U.S.-based member advisory company, has recently acquired analytics services provider KnowledgeAdvisors for approximately $52 million.
Following the announcement, Corporate Executive Board’s share price touched an intraday high of $78.17 before closing at $77.80, thereby recording a 4.6% increase. The stock price appreciation reflected a positive market sentiment of the transaction.
The Acquiree
Founded in 1999, KnowledgeAdvisors provides analytics solutions that measure and assess the impact that training initiatives have on an organization. Its unique cloud-based software application – Metrics that Matter – is configured to provide comprehensive analytic solutions that enable companies to evaluate and improve their talent development programs. This results in improved allocation of human capital investments through strategies that enable speedy, more accurate and data-driven decision-making.
An estimated $145 billion is spent by corporations annually on training programs, but more than half of that investment reportedly fails to culminate in material returns, with performance gains from learning investments estimated at less than 10%. KnowledgeAdvisors pioneered an initiative to attempt to resolve this issue by developing analytic solutions to enable companies to focus on the most constructive strategies for talent management and workforce optimization. Its technology and consulting solutions enhance productivity, reduce administrative costs and increase returns on training programs such as sales, leadership, onboarding and corporate universities.
KnowledgeAdvisors’s integration with Corporate Executive Board will strengthen the former’s ties with clients by linking outcomes more strongly to talent insight and best practices. It will also enable KnowledgeAdvisors to showcase its analytics to more than 16,000 senior executives in the Corporate Executive Board network.
Synergies
Talent-focused organizations expect significant operating synergies to result from the acquisition, given Corporate Executive Board's know-how on the competencies that drive performance and KnowledgeAdvisors' analytic capabilities and learning benchmarks. This acquisition puts Corporate Executive Board in a position to optimize training investments, enabling senior executives to make high-impact leadership development decisions in a data-driven manner, thereby maximizing operating efficiency and driving corporate performance.
Going Forward
Corporate Executive Board helps to unlock the potential of organizations by mitigating vulnerabilities across the entire information risk expanse, including technology changes, data privacy, and widespread employee digital access. The company boasts the industry's most robust talent measurement platform. It also has a strong portfolio of organically developed new products, enhanced by the acquisition of Talent Neuron. The company’s latest move consolidates its position in the emerging talent management space and further stimulates its revolutionary work involving talent acquisition, evaluation and development.
Experts believe that the integration of the assets will create a powerful platform to transform the talent decision-making process of companies. For Corporate Executive Board, this is the fourth acquisition in the talent management space, following the buyout of TalentNeuron last month, U.K.-based SHL in Jul 2012 and Valtera in Feb 2012.
At present, Corporate Executive Board carries a Zacks Rank #3 (Hold). Some other stocks that look promising in the industry include CBIZ, Inc. (CBZ), Huron Consulting Group Inc. (HURN) and Bureau Veritas SA (BVRDF). While CBIZ sports a Zacks Rank #1 (Strong Buy), Accenture and Bureau Veritas have a Zacks Rank #2 (Buy) each.
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