Kirk Laughlin
By Filipe Pacheco
Stefanini IT Solutions, one of the biggest players in the IT and Outsourcing industry in Brazil, has just made another move towards expansion in Latin America — this time, towards the southern part of the continent. The company founded and managed by Marco Stefanini has now bought Top Systems, one of the biggest producers of core banking software in Uruguay.
The Montevideo-based firm is focused on IT services for financial institutions and already had the Brazilian company as an allied partner. Its main product, called Topaz, is used by financial institutions of different sizes, mainly banks, microcredit institutions and compliance departments. Topaz uses Service Oriented Architecture and Java technology.
“Even though the company is based in Montevideo, their products are utilized throughout Latin America, including Central American countries. For us, it is a strategic move to get closer to clients we do not have today,” Marco Stefanini told Nearshore Americas. The CEO did not disclose how much was spent in the acquisition of Top Systems, which has about 120 employees working from Uruguay today. According to him, the conversations that culminated in the deal lasted for about six months.
Initially, Top Systems will continue to operate with its original name but will use the colors and the logo of the Stefanini. “But we might change that in the future, we have not thought about it yet,” said Mr. Stefanini, who is in the United States today. He did not disclose financial details of the transaction.
Top Systems was created in 1987 with the aim to generate “innovative technological solutions” for its clients, it is an ISO 9001 certified company. Besides its headquarters in Uruguay, the company also has an office in Lima. Its main competitor in the domestic market is Bantotal.
“With expertise in this market and with the 20 biggest Brazilian banks as clients today, Stefanini complements its offering in core banking, providing access to institutions of any size,” says Marcos Monteiro, Business Consulting director at Stefanini. Today, financial markets represent 33% of the revenues of the company, and more than 90% of the private banks in Brazil are served by the firm.
On April 26th, Top Systems announced a partnership with Stefanini to serve a Brazilian client called Banco Coperativo Sicredi – a financial organization focused on cooperation entities that is very strong in funding in the Southern States of Brazil, especially Rio Grande do Sul, which borders Uruguay.
The Uruguayan perspective
“This is an important move for the Uruguayan software industry as a whole,” comments MarioTucci, partner in MVD Consulting, a boutique business consulting firm that specializes in change and operations management, as well as globalization strategies for multinational companies.
He explains that even though the banking industry is considerably small in comparison to that of Brazil, the local software companies have specialized themselves to provide core financial systems technology in many Latin countries, and are quite a reference when it comes to financial software production in the region.
Another positive point of the acquisition says Tucci, is the strengthening of the Latin American market as a whole, and the closer contact between regional companies to develop the regional software market, “that way they can compete with Indian and American peers,” he adds.
“Just recently foreign investors started to consider players in the Uruguayan market, which has always been formed mostly by local companies. But there is a moment when they need scale to grow, and these investments are welcome for that,” Tucci said in an interview with Sourcing Brazil. “At the same time, Brazilian companies seek to expand abroad, they need to.”
Another positive point of the acquisition says Tucci, is the strengthening of the Latin American market as a whole, and the closer contact between regional companies to develop the regional software market, “that way they can compete with Indian and American peers,” he adds.
Ready for new acquisitions
“We are currently in conversations with other potential companies that can be purchased around the region. Those talks are always happening,” said Stefanini. This is the second company from the IT financial sector that Stefanini has bought in less than six months. At the end of last year, the company bought Orbitall, the IT branch of Itaú, one of the biggest private banks in Brazil.
Within one year between 2010 and 2011, Stefanini acquired two firms in the United States (TechTeam and CXI), and one in Colombia (Informática & Tecnología). “Moments of crisis are the best ones to grow, when the really good opportunities come up,” remarked Stefanini in an interview with Sourcing Brazil in May, 2011.
With the acquisition of CXI, Stefanini expanded its capacity to offer American clients services in staff augmentation, turnkey IT solutions, end-to-end ERP services, and functional sourcing. It also reinforces the alliance with SAP that CXI has had since 2006, which makes Stefanini a SAP certified partner in the United States.
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