Datatec's E-Services Group Acquires e-integration and Services Companies in USA and Switzerland.
LONDON--(BUSINESS WIRE)--Aug. 15, 2000
Datatec, the rapidly expanding networking and e-services multinational, today stepped up its drive towards higher margin services revenues for its E-Services Group with acquisitions by its e-integration and services division, Logical, of US-based Puget Sound Systems (PSSG) and Switzerland-based Conexus Global Information ("CGI").
Logical CEO, Rikke Helms said: "Both acquisitions are in line with Logical's previously announced migration to a pure e-integration and services business."
Depending on earn out considerations, Datatec will pay an amount between US$27.9 million and US$52.5 million for 100% of the outstanding stock of PSSG, with a payment of US$26.4 million raised through the issue of shares in Datatec to international institutions payable on completion of the transaction. In the case of CGI, Datatec is paying an amount between Swiss Francs ("CHF") 7.5 million already settled using internal cash resources and CHF15.0 million depending on earn out considerations.
PSSG is regarded as one of Northwest America's leading e-business solution providers, delivering end-to-end Web-based business solutions to both corporate and government customers. PSSG's skills range from custom application development and advanced database systems, to high-end interactive design, with the tools, expertise and methodologies required to create or adapt online technologies to provide fully customized e-business and m-business (mobile-business) solutions.
Hans Stoker, Founder and CEO of PSSG said: "I see the acquisition of PSSG by Logical as an endorsement of their e-business direction and look forward to leveraging off Logical's existing operations. The resulting exchange of intellectual properties and customer relationships will enable PSSG to broaden its coverage across the USA."
The acquisition of PSSG in Washington State provides Logical with a strategic foothold to leverage its existing US operations. PSSG is the third major E-Services Group acquisition that Datatec has made in the USA. It is strategically important in helping the company build Logical's position as a complete end-to-end e-business integration and services company in the large and rapidly growing US market. PSSG will be integrated under the Logical brand together with Datatec's other existing US investments in the e-business integration and services sector. The acquisition brings Logical's presence up to 410 staff in 32 offices across the USA and significantly opens up new opportunities in the markets of the Pacific Northwest and West Coast.
Helms said: "In addition to having complete end-to-end capability across the whole range of e-business solutions, PSSG has also invested in leading-edge technologies such as WAP (Wireless Application Protocol) which puts it at the forefront of wireless Internet and m-commerce applications development and integration. Through acquiring PSSG we have a great opportunity to leverage this knowledge across our existing operations and further our goal of making Logical a major player in the US e-business solutions market."
CGI is a rapidly growing European e-business solutions consultancy and supplier of one-to-one Internet based marketing solutions and telecommunication service management solutions. With a background in the Electronic Data Interchange (EDI) arena, CGI is now focused on electronic Customer Relationship Management (eCRM) applications and services, supporting customers in the retention and growth of their share of customer spending by providing solutions for intelligent relationship management.
CGI was also one of the first solution providers to implement BroadVision's software products (BroadVision is the market leader in the supply of one-to-one Internet based marketing products). In addition, CGI has strategic partnerships with SAS Institute, Sun Microsystems and HP.
Under the Logical brand, the company will play a significant role in global strategy development and project implementation in the areas of one-to-one Internet based marketing and analytical applications development.
For CGI, its integration into a global e-integrator represents an important step forward in its international expansion plans.
Hans Oury, Managing Director of CGI said: "On the basis of our strong position in the one-to-one marketing business, we had a number of very attractive offers from large international concerns. In making our choice, it was important to us not only to become the Swiss subsidiary of a global concern, but also to be able to have a decisive influence on future strategy. Logical and CGI shared a common vision and the fact that our companies work well together has already been proved by several joint international projects in Europe and South Africa."
Helms is very optimistic about the potential opportunities resulting from both deals: "PSSG has built an excellent reputation as one of the USA's leading independent e-business solution providers and is a leader in wireless Internet and m-commerce solutions. CGI has become a major force in the European eCRM solutions market and is a leader in personalization and one-to-one marketing applications. These are critical core competencies that will help us build Logical into an international e-business integration and services company. We are very excited about the opportunities for higher margin services business that are expected to arise from these acquisitions."
Notes to editors
Continuation of Cautionary Announcement:
Further to the cautionary announcement dated 21 July 2000, shareholders are advised that negotiations are still in progress which, if successfully concluded, may have an effect on the price of the ordinary shares in Datatec. Accordingly, shareholders are advised to continue to exercise caution when dealing in their shares until such time as a further announcement is made.
For further information please contact:
Tel: +27 11 444 8313
Mobile: +27 82 892 8378
Director, Strategy and Marketing, Datatec SA
Tel: +27 11 2331002
Mobile: +27 82 331 8008
Marketing Communications Director, Logical Worldwide
Tel: +44 1753 696699
Mobile: +44 468 825959
About Logical (www.logical.com)
Logical is the E-Integration and Services division of JSE-listed Datatec Ltd. (www.datatec-group.com). Driven from its London HQ, it has more than 2300 employees throughout operations in ten countries with further plans for international expansion well advanced. Logical focuses on complex, high value e-business services that facilitate the transformation of its customers' businesses from Old Economy models to Internet based e-business models. Logical's core offering is a set of methodologies and services that allow organizations to e-enable their businesses, while protecting their investment in existing systems, applications and databases. Logical's primary focus areas are e-business infrastructures, e-business solutions and e-outsourcing - all complementary, high-margin service offerings tailored specifically to the needs of the rapidly growing international market for e-services. Logical comprises the major part of an E-Services Group that Datatec intends to float on the London Stock Exchange in the second half of this year.
About Logical's USA Operations (www.us.logical.com)
The acquisition of PSSG brings Logical's US presence up to 410 staff in 32 offices across the United States. PSSG will become Logical's US center of excellence for e-business and m-commerce solutions, complementing the company's e-infrastructure businesses operating out of Detroit and Chicago. Significantly, the acquisition of PSSG opens up new opportunities in the markets of the Pacific Northwest and West Coast of the USA and will provide an opportunity to leverage its e-business skills across all of Logical's existing US customer base. It will also allow Logical US to provide complete end-to-end e-business solutions embracing infrastructure, applications and managed services operations.
About PSSG (www.pssg.com)
PSSG currently employs 59 staff (of which 49 are technical specialists) and also contracts the services of experienced subcontractors as and when required. PSSG's clients include Voicestream, Versidata, Airtouch, Holland America and a number of Washington State government departments. PSSG competes with firms such as Andersen Consulting, Cambridge Technology Partners, FutureNext, IGate (formerly Mastech), Whittman-Hart, Sapient and IBM Global Services.
About CGI (www.cnx-global.ch)
Since it was founded in 1995, the company has concentrated on the booming e-commerce and e-business segment. Its range of services encompasses consultancy and planning in the following business areas:
-- Electronic Customer Relationship Management (eCRM), including consulting on e-business strategies and call center design and integration;
-- Telecommunication Service Management, including performance and utilization management, service level and quality management and customer behavior analysis.
CGI's project implementation skills include Personalized Internet Content and Transactions Management (WWW and WAP) skills as well as analytic applications development leveraging the latest technologies in Data Warehousing and Data Mining.
CGI focuses on the finance and telecommunications markets; customers include Bank Austria, Credit Suisse, Orange Communications, Swisscom and UBS. The company currently employs 26 staff of which 20 are technical specialists.
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|Date:||Aug 15, 2000|
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