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The Warsaw Voice » Business » October 1, 2010
Business & Economy
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Polish IT Giant in the Making
October 1, 2010   
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Asseco Poland, the largest IT company listed on the Warsaw Stock Exchange, aspires to become Poland’s first global information technology company. The acquisition of leading Israeli IT company Formula Systems is expected to help Asseco achieve this goal.


Under two contracts signed in early September, Asseco Poland will acquire a 50.2-percent stake in Formula Systems—49.2 percent from Emblaze Ltd based in Ra’anana, Israel, and 1 percent from a Formula Systems executive. The total cost of the deal will not exceed $145.3 million.

“I am very happy that one of the largest IT companies in Israel will join the Asseco group,” said Adam Góral, chairman of Asseco Poland. “I pin great hopes on this partnership. Asseco will have partners in one of the most innovative countries in the world. Prospects are opening for our entry onto new markets, and access to know-how, innovative products and technology. We hope that with Formula we will speed up the process of building a truly global company. I am convinced that both Asseco and all companies making up the Formula Systems group will achieve considerable benefits by working together.”

Formula Systems is a holding company with stakes in three IT companies, Matrix IT, Magic Software Enterprises, and Sapiens International Corporation. They specialize in the production and delivery of IT solutions. The companies have a combined work force of 5,200. Formula Systems is listed on the Tel Aviv Stock Exchange (TASE) and the NASDAQ Global Market. Its companies operate on markets in Israel, the United States, Canada, Japan, Britain, Germany, the Netherlands, France, Hungary, and India. Matrix IT, which is a leading IT company in Israel, generates the highest sales and revenue. It has more than 500 customers in Israel, including banks, the government and health service and telecommunications companies.

“By acquiring the stake in Formula Systems we will secure a position for which we would otherwise have to work for many years on our own,” Góral said.

In 2009, the Formula Systems group posted a net profit of $19.1 million on sales revenue of $469.4 million. The annual sales of the Asseco group are estimated at around zl.3 billion.

Asseco Poland is not only the largest IT company in Poland but also the fifth largest software company in Europe, said Katarzyna Drewnowska, PR & IR director at Asseco Poland.

The Asseco group’s companies operate in 16 European countries and employ more than 8,000 people. Asseco is active in countries such as Slovakia, Hungary, France, Britain, Italy, Austria, Germany, and Spain, in addition to the Balkan region and Scandinavia.

After the deal with Formula Systems is finalized—the transaction must first get the go-ahead from a general meeting of Emblaze shareholders, which is scheduled to be held by Nov. 30—revenue generated in Poland will account for only a third of Asseco’s overall sales. The rest will be generated abroad. Asseco’s foreign expansion will not stop following the deal with Formula Systems. “We will continue our strategy of building strong regional centers in Europe. We are pursuing several acquisition projects in Western Europe and are in talks with attractive companies from Sweden, Spain and Switzerland,” said Drewnowska. “Asseco is building a global firm. Of course, we want to strengthen our position in Europe. Our dream is to enter the South American market, though we have not found a partner yet with whom we could enter this market. With our Israeli partners we are eyeing the Russian market. We also want to strengthen the group’s presence in the United States.”
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