London-listed Dimension Data Holdings plc (Dimension Data) has expanded its European footprint with the strategic acquisition, by its Swiss subsidiary Dimension Data Switzerland, of Netpartner AG, (Netpartner). Netpartner a leading Zurich-based network integration company. The purchase is effective from 1 October 2000.
The acquisition is in line with Dimension Data`s stated intention of establishing itself in key markets in which it is not yet represented and expanding in areas where it lacks critical mass.
Switzerland has been identified as a market with significant growth potential due to the high incidence of Multinationals and financial services operations, which tend to invest heavily in IT infrastructure and service. Zurich, in particular, is an attractive market as it is where 60 -70% of the country`s economic activity is based.
According to Vangelis Tsingos, managing director of Dimension Data Switzerland, Dimension Data currently enjoys a strong position in Geneva, Lausanne, Bern, Zug and Lugano.
"The acquisition will add a meaningful presence in the important market of Northern Switzerland. In addition to its geographic location, Netpartner was an attractive acquisition prospect for Dimension Data due to its strong focused management team, valuable network integration skills and a solid customer base. . Key customers include ABB, ETA (Swatch Group), Sulzer Textil, LEGO, Migros and Cantade Privat Bank (UBS Group)," he says.
Netpartner`s experienced management team, which includes its four founders, has signed service contracts with Dimension Data. The business will be integrated with Dimension Data`s existing Swiss operations trading as Dimension Data Switzerland
Netpartner was established in 1995 and has achieved compound annual revenue growth of 40% since then. In 1999 the company was awarded Cisco`s Reseller of the Year award for Switzerland. Although predominantly a Cisco integrator, Netpartner also has exposure to Check Point, RSA and Watchguard in the Network Security arena. Approximately 18% of revenue is derived from services.
The company expects to generate revenues of some US$7,5-million in the 12 months to end-December 2000 and, over the medium term, revenue growth in the region of 30% per annum is anticipated.
The purchase consideration, to be satisfied in cash (with a partial upfront payment and the remainder payable over two years), represents a price to earnings ratio for the 12 months to December 1999 of 20, depending on the achievement of profit targets in the years ending September 2001 and 2002. The value of net assets acquired is $ 0,92 million.
Don Smyth, Dimension Data senior vice president Europe says the combination of the Group`s top-performing operation in the French and Italian speaking parts of Switzerland, and Netpartner - which will be integrated with our existing branch in Zurich - positions Dimension Data to take advantage of opportunities presented by our Global Services Operating Architecture (GSOA) in the Network Services and i-Commerce arenas.
"These services are geared to meet the New Economy needs of the large number of multinationals and corporates based in Switzerland. The incorporation of Netpartner into the Dimension Data Group will facilitate growth through enhancement to the level and extent of services offered."
Felix Widmer, managing director of Netpartner says Dimension Data`s global footprint and extensive high- end service skills provide a platform from which to broaden the company`s offering to its client base and to tap into new customer markets.
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