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July 16, 1990

DOWTY EXPLAINS PLANS FOR ITS YOUTHFUL DANISH LOCAL NETWORKING ACQUISITION

By CBR Staff Writer

With the acquisition of Danish local area network specialist Dataco A/S for UKP22.7m (CI No 1,458), the Information Technology arm of Dowty Group Plc is intent on becoming, as IT division managing director Bruce Brain puts it, a one-stop shop for data communications systems. As a supplier of the ScaNet range of open systems interconnection networking products, Dataco will take its place within the division beside wide area networkers such as the Dowty Information Systems division – best known for its modems – and Dowty-owned Case Communications and Case/Datatel. Dowty chairman Tony Thatcher further commented that the purchase of Dataco, which sells through partners in 20 countries, would provide a means for Dowty to bust France and Germany along with the rest of Europe before the arrival of the single market. Dataco was founded five years ago in Copenhagen by Michael Mathiesen, who will be retained as Dataco managing director by Dowty; the ScaNet range of communications and terminal servers, transceivers, repeaters and routers is claimed to be capable of integrating 85% of all data processing equipment, with gateways to IBM SNA and DEC LAT environments; in 1989, Dataco developed its own ASIC chip. ScaNet customers include Saab, Citibank and Mercedes-Benz, which are, and will continue to be reached exclusively through a number of OEM partnerships, including one with Case Communications. For the last two years, Arthur Anderson & Co has voted Dataco the fastest growing Danish company: turnover currently stands at around UKP15m, 60% of this from outside Denmark – Dowty intends to grow this figure to 90% within a few years, and as part of that plan intends to launch Dataco into the US. For its part, Dataco sees the purchase in terms of increased financial stability and visibility; 31-year old founder Mathiesen also claimed that working with what he called the old men above him at Dowty would be a beneficial experience for him personally. Apart from Dataco, Dowty Information Technology – the second largest division within the Dowty Group Plc with sales of UKP197m – has presences in West Germany, Australia and the US: according to Thatcher, the aim is to increase the proportion of non-UK sales from 25% to 50% in the next two years. One area Thatcher is particularly keen to get into is Italy, reckoning that if Dowty found the right firm there, we would be in like a shot.

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