Analyst Corner: TechM’s Dynacommerce buy to boost European presence

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Published: February 6, 2019 4:30:37 AM

TechM has been acquiring capabilities through small tuck-in acquisitions (Inter-Informatics and now Dynacommerce).

TechM, TechM Dynacommerce, European markets, digital service providersThe acquisition bolsters TechM’s 3-4-3 strategy with one of the pillars being delivering connected customer experiences.

TechM has signed an agreement to acquire Dynacommerce Holding (Netherlands) which specialises in customer experience and end-to-end omni-channel solutions for telecom, cable, media and utility clients. The acquisition is an all cash deal and the entity has been valued at 1.73x EV to sales (Paid: EUR 4.39 mn in equity and EUR 11.48 mn for debt on books). TechM has been acquiring capabilities through small tuck-in acquisitions (Inter-Informatics and now Dynacommerce). Given TechM’s strong footprint in telecom, the acquisition would further strengthen its offerings in its focus vertical. We see the acquisition as positive and in sync with its strategy of providing connected customer experience.

The acquisition bolsters TechM’s 3-4-3 strategy with one of the pillars being delivering connected customer experiences. This along with previous acquisitions of BIO Agency (UK) and Pininfarina (Italy) strengthen offerings around digital transformation. Dynacommerce is present in Netherlands, Bengaluru and Germany and the acquisition will strengthen TechM’s ability to partner with clients on offering better customer experience and digital transformation. The acquisition will add ~129 professionals. We believe this acquisition will also strengthen TechM’s presence in the European market which has historically been tougher to penetrate. Dynacommerce recorded muted revenue growth of Euro 9.14 mn in CY18 (contribute 0.2% to TechM’s rev). We believe the acquisition has been done with focus on capabilities, gaining access to European markets.

Dynacommerce provides end-to-end omnichannel sales and order-management solutions for mobile, cable, media and utility companies. It helps clients to easily and rapidly transform into agile digital service providers enabling the most complex customer journeys and business models of today and the future. By unifying the customer journey across multiple channels, devices and touch points, Dynacommerce enables a seamless, consistent buying experience, with the flexibility demanded by their customers.

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