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Have FPT a "Whack" when spending $ 50 million buying a US technology consulting firm?

Saturday - 21/07/2018 04:24
It was not the first time that FPT had implemented M & A. FPT had successfully conducted a deal with RWE IT Slovakia and changed its name to FPT Slovakia in order to boost its presence in the European market and expand its customer base. in the field of energy. But in this deal, does FPT have a "whack" when spending $ 50 million to buy a US technology consulting company that has only $ 30 million in revenue?
Many doubts about the million-dollar business

Recently, the business and technology industry was stirred by the M & A deal worth millions of dollars between Vietnam's leading technology group and FPT Technology Intellinet. It is worth mentioning that FPT has paid up to $ 50 million to buy a consultancy company with a turnover of only $ 30 million.

Many questions and issues raised for the deal: Why do FPT pay more than the total revenue of Intellinet? Why is a leading US company selling 90% of its shares to FPT? Ending a successful M & A deal is the beginning of a lot of effort to keep Intellinet's professionals in line with the culture of FPT. Will FPT be well prepared?

Deciphering the business "Drop the iron hunter, catch the perch"

First of all, it is necessary to mention the funding for this million dollar business. In fact, FPT only paid $ 30 million for Intellinet, the rest will be paid based on Intellinet's business results for the next three years. This means that not only FPT but Intellinet need to mutually complement each other to complete this deal.

One thing that reinforces FPT's belief and strategy when it comes to deciding the deal is the growth and business of Intellinet. By 2017, Intellinet's revenue is $ 30 million, up about 15 percent from 2016. The company currently provides services to approximately 200 customers, including Fortune 500 clients such as NCR, Subway. , Wayfair ... Based on this potential of Intellinet, it can be seen that the acquisition of Intellinet helps FPT accelerate sales growth from overseas markets, especially in the US market.

Owning a 90% stake in Intellinet, FPT expects that over the next 12 months, US $ 100 million in revenue will reach US $ 100 million, more than double the revenue in 2017. In addition, FPT is expected to improve at 20%.

With these financial figures, the US market will be one of the key drivers for FPT's achievement of its overseas sales target of 50% of its total revenue by 2020. In the first five months In 2018, foreign sales accounted for 37% of FPT's total revenue.

In addition, when choosing to buy a leading technology consulting company with experience and high expertise, especially in the areas of financial insurance, medical, manufacturing, retail distribution, drop the hunter, catch the perch "to help FPT be complemented and perfect the technology services from the initial strategic consulting to the design, implementation, maintenance and finally, especially digital conversion projects. This deal will help FPT raise its technological position, become a partner in providing higher value and comprehensive technology services to its customers.

Trade is mutually beneficial

About this M & A deal, FPT representatives said that they put the issue of mutual benefit, which is not purely M & A but also offers more opportunities for both parties. Intellinet has the opportunity to expand beyond the United States. FPT, unlike other companies, is a merger. Finally, both FPT and Intellinet representatives have recognized that both sides have a vision, strategy and culture alignment, so Intellinet is ready to "sell" itself to FPT and FPT confidently retain their expertise. Intellinet experience.

So far this year, FPT is the only Vietnamese IT company that has managed to reach two M & A deals in two of the most advanced markets in the world - the US and Europe. After all, M & A still demonstrates that FPT's sound strategy helps it grow globally and is a pioneer in digital convergence.

Source: Theo Nhịp Sống kinh tế

 Tags: FPT, RWE IT Slovakia

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