While it is not yet clear whether Misys and Temenos will merge to move out of the gap between gorillas and antelopes, French software and services company Sopra announced “a project to acquire a majority stake in the Belgian company CallataÃ¿ & Wouters (C&W).” For obvious reasons, it is too early to provide any detailed comment on this announced merger. However, I see two initial areas of interest:
- Sopra’s ability to integrate the new capabilities technology-wise and organisationally. Sopra has acquired firms in the past. However, its acquisition speed has accelerated enormously: It acquired Delta-Informatique in October 2011 and proposed the acquisition of Tieto Corporation’s UK financial services product business and the UK subsidiary of Business & Decision on February 13 — just four days ago.
- Sopra’s solution portfolio after the acquisition. Sopra stated that it intends to integrate C&W’s Thaler banking platform with its Evolan solution set providing, for example, lending, payments, and cards management. The just-acquired banking platform of Delta-Informatique, Delta-Bank, seems to be positioned somewhat outside this market, for “tier 3 banks” — which is not a very clear separation from C&W’s Thaler banking platform’s target clients.
Thus, 2012 has the potential to become the year of acquisition and mergers that Forrester has expected for quite some time as part of increasing competition and of the growth strategies of those vendors that are doing better in the financial services market. Will this be a positive move for the merged entities’ customers? Merged entities may decide to continue maintenance and development for most of, or even their entire, joint solution portfolio — similar to FIS’s approach to go to market with its 13 banking platforms. However, there is no such thing as certainty in an M&A situation — in particular when considering the long term.
Posted by Jost Hoppermann