Press Releases


SEB reaches agreement to acquire Stroma Services Consulting Ltd.

October 22, 2013 – Toronto, ON

Smart Employee Benefits Inc. (“SEB” or “Company”) (TSX VENTURE:SEB) is a technology company providing “business processes software solutions and services” to corporate and government clients with specialty practices focused on “managing group benefit solutions and health claims processing environments.” SEB has agreed via a Memorandum of Agreement (“MOA”) to acquire Stroma Service Consulting Inc. (“Stroma”). The acquisition will be completed through SEB’s wholly owned subsidiary, SOMOS Consulting Group Ltd. (“SOMOS”) in Ottawa. The transaction remains subject to final Board approval, regulatory approval and completion of final due diligence processes.


The total value of the Stroma transaction is targeted at $1,500,000, subject to final adjustments at the Time of Closing. Per the terms, Stroma shareholders will receive the following:

  1. Cash: $700,000
  2. Vendor Take Back (“VTB”) – $300,000 paying interest at an annualized rate of 3% with annual principal repayments over a 3 year period. This VTB is convertible into SEB shares at $0.50, $0.60 and $0.70 in years one, two and three, respectively.
  3. SEB Shares: $500,000 at $0.40 per SEB share with escrow terms over a period of 36 months.
  4. 1,000,000 common share purchase warrants exercisable over a period of 4 years at $0.50, $0.55, $0.60 and $0.70, respectively, with escrow terms tied to retention.


John McKimm, President and CEO of SEB states: “A key component of SEB’s growth strategy in 2013 is acquisitions. We continue to focus on acquisitions with three objectives: (1) the acquisition of key client and vendor relationships in both government and corporate sectors, (2) the acquisition of unique technologies and expertise that enhance SEB’s technology solutions and delivery of services to select initiatives, particularly in healthcare, and (3) expediting the path to consolidated profitability while expanding a strong base of clients and sales to launch organic growth initiatives.”

Adam Jasek, EVP Acquisitions for SEB and President of SOMOS states: “Stroma’s deep ITIL experience and stellar references adds to our growing Canadian presence, particularly in Ottawa and Toronto. This acquisition is in line with our focus on deepening client relationships in government and healthcare. Stroma has a history of profitability and brings unique expertise that adds to the suite of solutions and services that enhance SEB’s healthcare and SOMOS technology offerings to corporate and government sectors. Stroma client references significantly enhance the SEB group’s ability to respond to business opportunities.”

Mark Sherry, CFO of Stroma states: “We have worked with John McKimm for almost ten years on various joint ventures and sales opportunities. During the past year, SOMOS and Stroma have participated successfully as joint venture partners in several outsourcing initiatives, one in particular with Department of Health in Ottawa. In addition, we are co-bidding on a number of other government projects, including a major e-health initiative in Western Canada. John and Adam know our business well and understand the unique expertise and references Stroma brings to the SEB infrastructure. Joining forces with SOMOS and the SEB group of companies will significantly enhance Stroma’s ability to drive new business opportunities.”


Stroma provides software, consulting, and training services as an IT Service Management company. Stroma’s client base is in both Canada and the US. Significant clients include various Canadian health ministries along with other government departments. Stroma has completed a number of successful healthcare projects, has relevant security clearances, many valuable corporate and government project references and key vendor arrangements with both corporate and government clients.


SEB is a technology company providing software, solutions and services specializing in managing group benefit solutions and healthcare claims processing environments for corporate and government clients. This is a $56.0 billion industry, of which over $33.0 billion relates to employee group benefit plans and over $23.0 billion relates to other healthcare benefit claims (e.g. workers compensation claims, travel benefits, various federal and provincial government programs, dental associations, drug associations, etc.) In the employee group benefits industry, SEB operates a licensed third party administrator (“TPA”) and insurance broker utilizing its software platform to provide “totally hosted PCI compliant supply chain solutions” for managing the complete group benefits business processes between insurers, clients, brokers, consultants, technology service providers and healthcare service providers. In healthcare claims processing, SEB also operates as a systems integrator utilizing its technology platform together with other technologies to provide customized solutions for highly specialized environments (e.g. travel claims, etc.). The technology and expertise deployed in this healthcare area also allows SEB to provide other related supply chain, systems integration and human resource solutions and services to the same clients.

Forward-Looking Statements:

This news release is intended for information purposes only. Statements made in this news release may contain “forward-looking” information about the company’s future business prospects. These statements while expressed in good faith and believed to have a reasonable basis, are subject to risk and uncertainties that could cause actual results to differ materially from those set forth or implied by such forward-looking statements. Investors should consult a professional advisor before making any investment decision.

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