SOFTWARE: Webmedia Grows Twice in Size with Finnish CCC Buy
20 Jun 2011 • by Natalie Aster
Webmedia Group, the largest Estonian web and software solutions provider with Lithuanian investors holding a sizeable minority stake, purchased 97.57% of the Finnish peer CCC Corporation for an undisclosed sum, effectively doubling its turnover with the acquisition. According to Priit Alamae, CEO of Webmedia Group, the company used its own capital together with a bank loan to finance the purchase.
Webmedia Group bolstered its share capital recently by selling a 36% stake to Polish Enterprise Investors, a private equity investor, for EUR 7m. "We expect our turnover with CCC included to reach EUR 40m this year," says Alamae to news2biz. "In 2-3 years, we expect to double the turnover yet again to EUR 80m."
In 2009, Webmedia Group's consolidated turnover reached EUR 15.3m, a 9% increase compared to the previous year, while its profit soared by 81% to EUR 1.8m. The group's financial results for 2010 are not available yet. At the same time, CCC Corporation expected to turn over EUR 22m in 2011.
Webmedia Group has subsidiaries in Estonia, Lithuania, Romania, Serbia and Egypt, operating in the field of web-related software development and marketing as well as developing large-scale software solutions for the public sector. CCC, in turn, has mostly provided software for industrial production and materials management.
According to Alamae, the companies complement each other perfectly and the acquisition is more like a merger of equal parties. "In this case, one and one equals more than two," he says. "Both companies retain their brands and nothing will change in everyday operations of one or the other," says Alamae. "However, we plan to market the solutions of Webmedia in Finland with the help of CCC and vice versa."
Webmedia Group employs 400 staff while CCC has 200 people. "The CCC team is an important asset; by no means did we acquire the company just to sack them and bring the development operations to Estonia. On the contrary, our intention is actually to hire more people in Finland," notes Alamae.
Webmedia's management has stated earlier that it ponders an IPO in a few years in order to finance further growth of the group. "The recent acquisition has not changed anything in our IPO plans, the term still stays," says Alamae.
In January, Webmedia acquired the data management business of Microlink, the IT-services provider owned by Elion. According to Alamae, the company has no more acquisition plans in the near future, and it rather tries to grow organically. "Although I will not completely rule out further acquisitions."
IN BRIEF
BlackBerry from Omnitel too
Omnitel, Lithuania's leading mobile telecom, started selling BlackBerry smart phones that so far were only available from Bite Lietuva (since 2008), one of the company's two main competitors.
The above news abstract has been taken from a bi-weekly newsletter to professionals doing business in Eastern Europe "news2biz - IT and Media".
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