ECsoft Group Acquires German Based DVMB AG
ECsoft Gains Presence in New Territory and Strategic Microsoft Relationship
LONDON, England, January 17, 2000 - ECsoft Group plc ("ECsoft" or the "Company"; London: ECS, NASDAQ: ECSG) the independent E-business consultancy, systems integrator and IT solutions provider, today announced the acquisition of DVMB AG, a German based IT services company providing Information Systems and Service Management (ISM) to medium and large-sized companies in Germany. The acquisition is based upon an initial payment of DM 4.8 million in cash and 129,000 ECsoft shares, supplemented by an earn out payable in cash up to a maximum of DM 19.1 million, based on the performance of DVMB over the next 12 months. "Through the acquisition of DVMB AG, ECsoft Group gains DVMB's highly strategic and enviable relationship with Microsoft," commented Terje Laugerud, CEO and President, ECsoft Group plc. "We are pleased to be entering the German IT market which strengthens our significant presence in Northern Europe." DVMB's primary service offerings include infrastructure consulting, bespoke web applications, support services, and a training and seminars practice. With a workforce of 89 people, DVMB AG is headquartered in Solingen, outside of Düsseldorf, with three other offices in Germany. Through this acquisition, ECsoft will be able to develop a presence in the German IT services market, leveraging DVMB's established blue-chip customer base (which includes 30 of the 50 largest companies in Germany), DVMB's strong partner relationships, and DVMB's services management software offering.
DVMB AG has built and benefits from a solid and strategic partner relationship with Microsoft. DVMB is the only Certified Microsoft License Audit Partner in Germany and has earned several Microsoft certifications. DVMB's partner program also includes relationships with major industry software and services companies, including IBM BesTeam, Oracle, Computer Associates (Cheyenne), Viag Interkom and SAP. As a competitive differentiator and compliment to their ISM services, DVMB AG, in coordination with Microsoft, has developed a proprietary services management software offering, DVMB Help. The product is a scalable help desk tool for client server networks that offers a full range of support tracking, administration and reporting controls for medium to large-sized networks. DVMB AG recently signed an exclusive worldwide distribution agreement with Microsoft to bundle DVMB Help with both Systems Management Server (SMS) and SQL Server. "The acquisition of DVMB AG is the continuance of a defined and communicated strategy to expand ECsoft's presence into mainland Europe. This strategy was initiated in 1999 with two acquisitions in the Netherlands," commented Terje Laugerud. "As one of the most advanced IT markets in Europe with rapid adoption of new technologies, we see Germany as a prioritized market." "In combination with our Services Management strategy, we think DVMB Help will add value to ECsoft Services across all territories, in particular the services offered by our ISM Practices," continued Laugerud. "We believe DVMB's excellent relationship with Microsoft and solid partner program will enhance and strengthen ECsoft's partner programs across the Group." Under the terms of the agreement, ECsoft will purchase all the shares of DVMB AG. From its last audited accounts, DVMB's revenues for fiscal year ended 31 December 1998 were DM 8.7 million, net assets were DM 700,000 and operating profits were DM 600,000. DVMB AG will become a wholly owned subsidiary of ECsoft Group plc and will trade as ECsoft Germany.
About ECsoft Group plc: ECsoft Group plc (London: ECS, NASDAQ: ECSG) is an independent E-business consultancy, systems integrator and IT solutions provider, specialising in the development and delivery of innovative mission-critical business solutions to Europe's top 500 companies. With a workforce of over 1000 people, following the DVMB acquisition, across sixteen offices in the UK, Denmark, Norway, Sweden, the Netherlands, and now Germany, ECsoft is a leader in the practical application of advanced technology and in turning a customer's E-business vision into a technical reality. More information about ECsoft Group can be found at www.ecsoft-group.com. FORWARD LOOKING STATEMENTS: Statements contained in this release that are not historical facts may contain forward-looking information with respect to the plans, projections or future performance of the Company, the occurrence of which involve certain risks and uncertainties. Potential risks and uncertainties include, without limitation, continued competitive pressures in the market place; reliance on attracting and retaining technically skilled professional staff; successful integration of acquired companies; managing risks associated with customer projects; significant fluctuation in quarterly operating results; the Company's ability to manage its growth; dependence on trends towards open systems computing architecture and outsourcing; reliance on key executives; reliance on relationships with third parties; and the Company's ability to develop information technology solutions that keep pace with rapid and continuing changes in computing technology, evolving industry standards and changing customer preferences.
More information on potential factors that could affect the Company's financial results are included in the Company's filings with the Securities and Exchange Commission, particularly in its Annual Report on Form 20-F. ECsoft Group plc: Registered office: 101 Wigmore Street, London W1H 9AB, ENGLAND +44 (0)171 355 1101, fax: +44 (0)171 355 9001, www.ecsoft-group.com
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