Stockholm-based internet services consultancy Framtidsfabriken AB (Framfab) has made a SEK1.5bn ($174m) offer for 100% of Guide Konsult AB, another Swedish consulting firm headquartered in Gothenburg. It has also paid SEK550m ($64m) for the smaller Frechen-based company Mindfact Interaktive Medien AG, marking its entry into the German market.
Framfab CEO Jonas Birgersson said the Guide acquisition will hoist the group to third place among internet consultancies, behind USWeb/CKS Inc and IXL Enterprises Inc. Framfab will concentrate on mobile, broadband, and embedded home and vehicular applications, he added.
Birgersson’s counterpart at Guide, Johan de Verdier, said his company brings expertise in Bluetooth, where it is working with the original developer LM Ericsson Telefon AB, and in embedded technologies, as well as in product management and systems integration. There is clearly also a simple reinforcement issue, with Guide adding some 750 people to Framfab’s own 735.
Framfab and Guide have several customers in common already, such as Ericsson (Framfab for WAP, Guide for Bluetooth) and Swedish vehicle manufacturer Volvo AB, whose car division was acquired by Ford Motor Co. Framfab reported revenue of SEK207m ($24m) in the first nine months of this year, while Guide had SEK465m ($54m), with a group EBITDA of 6.7%, according to Framfab CFO Johan Haeggman.
Regarding the German acquisition, Birgersson said it meant that Framfab is now present in Europe’s three largest IT markets, the other two being the UK and France. Mindfact has a staff of 105 people and specializes in web consulting and page design, together with complex web systems and back end integration with legacy systemsBirgersson explained. Its client list includes US industrial group 3M, and German insurer Axa.
As for further expansion, the first priority now is the US market, where Framfab expects to establish a beachhead before the end of the first quarter, probably through a smaller acquisition, said its CEO.
