Comarch Goes West
Comarch increased its market share in Germany as the company took control over a German ERP systems specialist, with another acquisition planned for Q1 2009. Until now Comarch had opted for setting up its own branches; however, the sale of Interia is to finance acquisitions of IT companies.
Shortly before announcing its Q3 results, Comarch signed an agreement to acquire 50.15 percent of the shares of SoftM Software und Beratung AG of Munich. In line with German regulations, having taken over 30 percent of the board, Comarch is required to make a call to tender the remaining shares. The transaction total value may reach 22 million euro. SoftM has a 2 percent share of the German ERP market and provides integration services and applications for the financial sector. The company is active in Germany, Switzerland, Austria, France, the Czech Republic and Poland. However, its main problem is poor results; in Q3 net loss amounted to 131.93 thousand euro. The purchase is to complement Comarch’s offer with solutions for mid-size clients.
The acquisition is a part of the company’s expansion plans which Janusz Filipiak, the president, has recently revised, as due to the exchange rate fluctuations, export to less strategic countries is far less profitable. As a result, the attention is on closer locations as well as on the largest international clients and their on-site projects, such as an electronic banking system in India. Still, the focus on German-speaking countries, France and Benelux does not imply closing the offices in Chicago, Dubai or Panama.
The next German acquisition is to be finalised in Q1 2009 and is substantially smaller than SoftM. Janusz Filipiak admits the Q3 Comarch results are poor; however, he is optimistic about the next quarter results, and is focused on investing in further expansion rather than on increasing revenue. The company’s value of 2008 orders on hand as of 31st October amounts to PLN 184 million; i.e. a 2.5 percent increase year to year.