Satyam eyes acquisitions in France, bets big on Germany
posted in Outsourcing News and Top Outsourcing deals |Source: timesofindia.indiatimes.com
MUMBAI: With a view to broadening its footprint in Europe, leading software major Satyam Computer Services, is mulling acquisitions in France, a top company official said.
“We see fairly large opportunities and are looking at acquisitions of French companies to expand our operations,” Satyam’s Continental Europe Head, Peter Heij, told visiting journalists at the company’s Wiesbaden facility near Frankfurt recently.
The company is also mulling an expansion in Germany, the largest economy in Europe, he said.
Satyam has recently sealed a few acquisitions, those of Nitor Global Solutions and Citisoft Plc in the UK and S&V Management Consultants in Belgium.
“Our vision is have 30 per cent of our global revenue emanating out of Europe by FY 10. To enter some of the European countries, we have to hire local people and acquire companies. We need to have an office in France,” Heij said.
In the current business scenario, European markets are evolving as a major IT park for software development. These markets are demanding greater knowledge and understanding of country-specific issues, EU directives and resolutions, he said.
France preferred to undertake sourcing of IT services in its own language and with local firms. Major international firms are well represented in France with providers like AtosOrigin, Sopra, Sogeti & Thales capitalising on the advantage of “being French”.
At 9.1 per cent, Germany’s CAGR for application outsourcing spending falls below the European average of 10 per cent. Of the Euro 2.4-billion that German firms spend on application outsourcing today, Euro 1.3-billion goes towards application maintenance services.
At the corporate level, Europe has been identified as one of the main focus regions. As a result there is increased management attention and more investment in the European region, Heij said.
“Our European strategy has succeeded in delivering profitable growth. In 2007, we demonstrated that we were focused on building sustainable and profitable relationships.
Our 2007 plan has delivered a growing position in European markets, deeper engagement with our major accounts and revenue growth above market trend,” Heij said.
Asked whether recession in the US would slow down global growth or have a wider impact, Heij said, the deterioration in financial markets and tighter credit conditions have increased the risk of recession and failure of businesses.
“With continued inflationary pressure from higher oil, commodity and food prices, monetary policy decisions will have to strike a delicate balance between growth and inflation,” he said.
Customers will have less money to spend but business activity would neither reduce substantially nor come to a complete standstill, Heij said.
