Ordina buys Belgium's ITG Consulting Group; reports H1 revenue growth

Source: Ordina

Ordina has acquired the full share capital of Belgian-based ITG Consulting Group.

ITG offers expertise and projects in the area of business consultancy, particularly in the finance market, with strong focus on high-end accounts and finance banks. Having been established in 1995, ITG Consulting expects to generate a revenue of approximately EUR 8 million for 2007. ITG Consulting has more than 80 employees in Brussels and Luxembourg.

ITG focuses its service provision on operating activities, clearance & settlement, business analysis, process design, and implementation of applications. It counts Fortis, ING, Dexia and Euroclear among its strategic clients.

Says Ronald Kasteel: "The acquisition of ITG Consulting opens up opportunities for us to enter the finance markets in Belgium and Luxembourg, in which we only had a very limited presence until now. Our ambition is to realise strong growth in this market over the next few years, in which process we certainly intend to fall back on the knowledge and long-standing experience that we have gained in the Netherlands. In addition, we will undertake a targeted effort to review the opportunities for our BPO services in Belgium and Luxembourg."

"The acquisition of ITG is in line with Ordina's ambition to be Belgium's Number 1 provider of ICT services in 2010," says Hans Vets, CEO of Ordina in Belgium. "The acquisition of ITG will singlehandedly propel us towards building a strong position in the French-speaking part of the country."

"Joining Ordina allows us to capture a larger slice of the Benelux market," says Carmelo Bardare, founder and CEO of ITG Consulting. "But it is especially the end-to-end solution that makes Ordina a very interesting partner for us. From now on, we can offer our clients a comprehensive service range, including technological expertise and solution development."

The acquisition price will be partly cash and partly share-based. Part of the acquisition price will be based on an earn-out scheme that is contingent on ITG's performance in 2007 and 2008; as a result, parrt of the acquisition price will not be paid until the first quarter of 2009. The acquisition price is in line with the usual range of 0.8 to 1.5 times sales.

Separately, highlights of financial performance for first half of 2007
  • Total revenue rose from EUR 257.9 million to EUR 311.4 million. This represents an increase of 21%.
  • EBITA was up 32%, from EUR 19.6 million in the first half of 2006 to EUR 25.8 million in the first half of 2007.
  • Earnings per share before amortisation of intangible assets at acquisitions rose to EUR 0.49 (first half of 2006: EUR 0.38). This represents an increase of 29%.
  • Revenue from consulting, ICT and application outsourcing rose from EUR 242.5 million in the first half of 2006 (excluding Infrastructure Management, divested in H1 2006) to EUR 296.0 million in the first half of 2007. This represents an increase of 22%.
  • The operating margin on consulting, ICT and application outsourcing increased to 9.7%.
  • Revenue and profit from BPO activities developed in line with earlier guidance. Revenue was up by 52% to EUR 15.4 million in the first half of 2007. EBITA from BPO activities was EUR 2.8 million negative. In particular due to expected start-up costs of a number of major new contracts.
  • Acquisition in Belgium opens the door to the finance markets in Belgium and Luxembourg.

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