Fujitsu failed to secure the approval of two thirds of GFI shareholders it required, which always looked the likely scenario after GFI boss Jacques Tordjman declared the Fujitsu offer to be too low. GFI has said that it may now explore a possible merger with domestic rival Groupe Bull.
David Courtley, CEO at Fujitsu Services, said that the company would now look for other takeover opportunities: Our strategy continues to be based on both organic growth and acquisition in the principal European markets, including France.
The Fujitsu parent organization has highlighted IT services as one of its key target growth areas, and it expects this part of its business to help it to reach its goal of generating half its revenue outside Japan within two to three years, from a current level of around one third.
Fujitsu said when it originally launched its offer for GFI that it was receiving more requests from clients for it to support their operations across continental Europe. The company has made recent progress in Germany through the $108m acquisition of local services supplier TDS last year and the capture of a $544m infrastructure outsourcing deal with insurance giant Allianz in May.
However, it lacks scale in France and there are not many obvious potential takeover targets for it to pursue. The country’s second largest player, Atos Origin, would add bulk in France and the Netherlands, but might be too big to digest and it has already spurned one takeover offer this year.
With full-year 2006 sales of $1.5bn, Steria is the third largest French services vendor but it has just signaled its own international expansion ambitions through a $956m acquisition bid for UK applications services vendor Xansa. A more likely option is fourth-ranked Sopra, which made revenue last year of $1.2bn, and earlier this week reported impressive growth in its consulting and middleware units in the second quarter.
All other potential targets In France for Fujitsu Services would be smaller than GFI, such as local infrastructure services firm Devoteam. The supplier made sales of $350m last year and is understood to have attracted Fujitsu’s interest prior to its approach for GFI, although Devoteam’s management said earlier this year that they were not interested in a sale.
