Circle8, a European-focused IT staffing firm listed on Nasdaq, is intensifying efforts to acquire SThree, a UK-based recruitment company. Guus Franke, executive chairman of Circle8, indicated that the company is exploring all possible avenues to complete a deal, with key executives actively engaged in discussions as they await board approval on the next steps.

Based in Amsterdam and New Jersey, Circle8 posted revenues of $569.7 million in the first half of 2026, reflecting a 176 percent year-on-year increase. Despite the revenue growth, the company reported a net loss of $117 million during the same period. This loss included a $60 million settlement with SPP Credit Advisors, which resolved litigation linked to the cancellation of a $35 million loan note.

Circle8 faces a deadline of October 7 to formally announce its intention to make an offer for SThree. The proposed acquisition presents a notable valuation gap: Circle8’s market capitalization stands at under $50 million, while SThree is valued at approximately £380 million. Furthermore, Circle8’s share price has dropped nearly 90 percent over the past six months to 42 cents per share. Franke described Circle8 as “significantly undervalued” on Nasdaq and expressed confidence that a deal would establish a “global IT and technology company.”

SThree reported a 2 percent decline in net fees for the three months ending in August compared to the previous year. The recruitment group cited ongoing “challenging” market conditions but noted that the decrease in fees had slowed relative to the first and second quarters. The company also confirmed expectations of a pre-tax profit of at least £12 million for the year.

As Circle8 pursues the acquisition, both companies are navigating a complex landscape marked by shifting market dynamics and valuation disparities, with potential implications for the global technology recruitment sector.