TBP Spotlight – DXC Acquires System Partners and Capgemini Acquires June21

 

DXC Acquires System Partners and Capgemini Acquires June21

Deal Financials

Undisclosed  

Transaction Overview

  • On October 1, 2018, Capgemini SE (ENXTPA:CAP) announced its plans to buy French digital marketing consulting firm June 21 for an undisclosed amount to expand its digital marketing consulting expertise.
  • On September 26, 2018, DXC Technology announced its acquisition of System Partners, a Platinum Salesforce Consulting Partner headquartered in Australia.

Digital Transformation is Bringing Creative Processes Closer to IT

  • Digital transformations at companies are causing their marketing and IT departments work closer than ever before. While measuring marketing initiatives has become increasingly dependent on IT, clients are also turning to their IT service providers to help them with creative aspects of marketing. In response, software providers like Salesforce and Adobe and services providers like Capgemini (June21) and Infosys (Wongdoody) have tailored their M&A strategies to match this shift in customer expectations.
    Notably, Adobe, a staple with the creative marketing types, acquired Marketo and Magento for $4.8 billion and $1.7 billion, respectively, earlier this year. While Adobe’s Digital Media business continues to be its largest source of revenue, Marketo strengthens its product portfolio beyond the creative front-end of marketing processes. Magento provides Adobe deeper capabilities around e-commerce, an IT-intensive function.
  • Salesforce stayed ahead of this trend by outbidding Adobe for ExactTarget and Demandware in 2013 and 2016, respectively. Today, its Marketing and Commerce Cloud is its fastest-growing segment with 45% growth in FY2018.
  • Large IT services companies have adapted through M&A as well. Capgemini acquired digital customer engagement firm LiquidHub for $500 million in February, and Accenture acquired 3 digital marketing and design agencies since January.

Robust Investments and M&A in Salesforce Consulting Partner Ecosystem

  • In the past month, Cognizant, Infosys, and DXC have each acquired a Salesforce-focused services company. Cognizant’s acquisition of ATG in September was its second deal in the ecosystem in the past 2 months.
  • Among Salesforce Consulting Partners, specialized firms like the Commerce Cloud-focused Lyons Consulting Group received a lot of attention from potential suitors before settling with Capgemini in Sep 2017.

Recent Salesforce Consulting Partner Acquisitions


About True Blue Partners, LLC
True Blue Partners is a boutique M&A advisory firm that serves lower mid-market enterprise software, service and solutions companies. It brings the rigorous strategic and financial perspective of bulge bracket firms with a company building approach and a steadfast partnership that only an independent boutique firm can deliver. For more information please visit www.truebluepartners.com or email us at info@truebluepartners.com.

TBP was NOT an advisor to this transaction.