Tech Mahindra to acquire Target Group

IT services and solutions firm Tech Mahindra has agreed to enter into an agreement to acquire Target Group, one of the leading processing platform companies in the UK. The value of acquisition is $164 Million and an adjustment for surplus cash up to GBP 8 Million.

The acquisition catapults Tech Mahindra to one of the top three processors in UK financial services for certain complex lending and investment product categories. It also strengthens Tech Mahindra European presence and adds several new clients. The acquisition will make Tech Mahindra a formidable player in the UK BFSI market with over 50 major financial institutions as clients.

The acquisition is in line with Tech Mahindra strategy of expanding its Fintech capabilities and adding IP and platforms to drive non linearity and play aggressively in the BFSI sector. Headquartered in the UK, Target Group has 740 employees and a client franchise, including leading financial institutions such as Goldman Sachs, Morgan Stanley. Target Group also has a strong pipeline which provides for high earnings visibility and cash flow generation.

Target Group provides BPaaS offerings in the areas of lending and investment products servicing to its clients, on variable pricing models. The combination of proprietary software, strong regulatory compliance practice and domain knowledge is a key differentiator for Target Group. The acquisition will help Tech Mahindra to expand its offerings in the lending, savings and investment and insurance sectors.

Activision Blizzard buys Candy Crush Saga Maker

Call of Duty publisher Activision Blizzard has bought King Digital Entertainment, the creator of mobile smash hit Candy Crush Saga, in a deal worth $5.9 Billion. King Digital Entertainment had built one of the largest networks of players on Facebook and on mobile devices noting that King’s games had 474 Million active users in the third quarter of 2015.

Activision already owns one of the biggest gaming franchises in Call of Duty, in addition to Destiny and huge properties such as World of WarCraft and StarCraft as a result of its merger with Blizzard in 2008. The company’s gaming portfolio grows even bigger with the addition of the biggest name in social gaming. Consumer spending on Candy Crush fell 13 percent year over year in the second quarter of this year.

Activision Blizzard games are played on consoles such as Microsoft Xbox and Sony PlayStation. King floated on the New York Stock Exchange in March last year with a valuation of almost $8 Billion making it the most valuable British business of the tech craze. Candy Crush became wildly popular racking up a billion plays a day on smartphones for the company, based in London West End.

This acquisition clearly demonstrates a new commitment to mobile for Activision as well as the will to diversify their IP Portfolio to a more global female audience. Activision has taken in the past a more reserved approach to mobile, releasing only a handful of titles, like Hearthstone and mainly using mobile apps as side experiences to their PC and console games. In the meantime, global competitors such as EA or Tencent have embraced this new sector.

AB InBev to buy SABMiller

Anheuser-Busch InBev NV agreed to buy SABMiller Plc. for about 68 Million pounds, raising its bid after several rejections to clinch a record industry deal that will bring one out of every three bears sold worldwide under a single company.

The Budweiser maker will pay 44 pounds a share in cash for a majority of the shares in its nearest competitor. Belgian-Brazilian group AB InBev, the maker of Budweiser and Stella Artois lagers, struck a deal with the maker of Foster’s and Grolsch at the fifth time of asking. The deal is in the top five mergers in corporate history and be the largest takeover of a UK Company.

SABMiller two largest shareholders, Altria Group Inc. and Bevco Ltd, can receive cash and stock valued at 39.03 pounds a share for their stakes, which account for 41% of the company. They won’t be able to sell the shares for five years and will have the right to nominate directors. After years of speculation, the deal has been hastened by the impact of slowing economies in the emerging markets of China and Brazil.

SABMiller, the world largest brewer, claimed the previous bids undervalued the company, upping the pressure, ahead of regulatory deadline by which time its rival would have to make an official offer or walk away for at least six months.

Apple acquires VocalIQ

Apple Inc. acquired a UK software startup that could give its digital assistant Siri a boost. VocalIQ has built software aimed at making it easier for people to speak to computers in a more natural way, an area in which Siri and other voice recognition services have struggled. The company has been particularly focused on selling its product to auto manufacturers including a partnership with General Motors Co.

VocalIQ Technology is based on Machine Learning, an area of Artificial Intelligence in which a computer improves as it ingests more information. As a person uses VocalIQ Software it helps a device become more accurate at predicting what commands to execute. Other technology companies including Google and Facebook have been conducting similar research in this area.

Apple has been steadily improving Siri since its debut in 2011. While at first criticized for understanding only the most rudimentary of requests, the company has been adding features for getting sports scores, setting reminders, searching for an iPhone picture or finding directions. Apple buys smaller technology companies from time to time, and generally discuss purpose and plans. 

Mindtree Acquires Bluefin Solutions, Relational Solutions

Digital seems to be the flavor of the season. After similar moves by large peers, mid-sized Information Technology Company Mindtree has announced two acquisitions in the space, spending Rs 425 crore to shore up its digital business.

The company will acquire British Technology Consultancy Bluefin Solutions and US based analytics firm Relational Solutions. For Bluefin Solutions, Mindtree will pay Rs 423 crore. The UK headquartered company presently has a revenue run-rate of Rs 287 crore. The acquisition will help Mindtree gain about 50 clients in US and UK. Bluefin currently employs 170 consultants.

Relational Solutions is a provider of analytics for consumer packaged goods retail execution; Mindtree will pay Rs 63 crore in cash. The Ohio headquartered company had reported revenue of $3.2 Million in previous calendar. This buy will help Mindtree acquire analytics capabilities to offer insights on movement of goods such as beverages or chocolate for manufacturers. 

GroupM in talks to acquire Foxymoron

GroupM is the world largest advertising media company in terms of billing. It was formed in 2003 by WPP Group to serve as the parent company of WPP media agencies including Maxus, MEC, MediaCom, and Vocanic. It handles over 32% of the world media billings making it the world largest media investment management operation. Foxymoron was started in 2008 as a summer project between four friends and turned into a digital media and marketing company.

Global media firm GroupM is in talks to acquire Foxymoron for about $30 Million, as it seeks to establish dominant position in India. If the deal becomes successful then it will be the latest buyout transaction in the nascent, but fast growing Indian Digital, social media, and marketing sector. Global Media giant JWT is also scouting for potential acquisitions in the space.

Foxymoron provides an across the board range of services, including, end to end digital services, including design and development and social media services. The potential transaction is part of GroupM strategy to establish an even stronger footprint in the country, where it already has a dominant presence. India’s online advertising market is poised to exceed Rs 3500 crore in revenue in 2015.

Spend on video ads will grow at a compounded annual rate of 56% while contributing 12% to the overall market share of digital advertisements. The principal sources of acceleration in 2015 are China, where GroupM predicts ad growth will get back on track to just fewer than 10%, the US, forecast to pick up to 3.9, the Brazil, the UK, Japan and India. Acquisitions have been an important growth strategy for GroupM, which also acquired Chinese Social media agency Teein last year.