The Information Services Corp. buyout is a good deal, RBC says

RBC Dominion Securities analyst Paul Treiber says Plenary Americas’ $1.2-billion agreement to acquire Information Services Corp. (Information Services Corp. Stock Quote, Chart, News, Analysts, Financials TSX:ISC) fairly values the digital services company in a go-private scenario.

As reportyed by the Globe and Mail, coming off research restriction, Treiber raised his target on ISC to $51.00 from $39.00 to reflect the deal, while maintaining his “Sector Perform” rating. The average target is $45.00

Plenary Americas, an infrastructure fund manager owned by Caisse de dépôt et placement du Québec, announced May 19 that it would acquire ISC for $51 per share. The company plans to keep ISC’s Regina headquarters and have the business operate independently from its other portfolio investments.

“The takeout price equates to 11.0 times NTM EV/EBITDA, which represents an all-time high valuation multiple for the stock and at a premium to peers at 8.2 times,” Treiber said.

He said the multiple is slightly above precedent transactions, including OMERS’ 2008 acquisition of Ontario registry operator Teranet at 10.5 times EV/EBITDA.

Treiber said the price reflects CIC’s Golden Share, the ISC Act, the pricing structure in the master services agreement that runs to 2053, the fact registry data remains the property of the Government of Saskatchewan and commitments to strengthen ISC’s brand, preserve jobs and generate economic activity in Saskatchewan.

The analyst said another bidder is unlikely, noting the transaction follows an extensive strategic review that began in September 2025, involved multiple interested buyers, has the support of CIC and all ISC directors and officers, and comes at a valuation slightly above precedent deals.

Treiber also said ISC’s first-quarter results and updated guidance point to stable operations.

“Takeouts may be catalysts for the Canadian small-cap tech ecosystem,” he said. “With the valuations of some Canadian small-cap tech stocks near multi-year lows, we believe more companies may consider going private or selling to acquirers to maximize near-term shareholder value.”

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