In an interesting post-script to Paris-based Sopra’s recent UK acquisitions (see Sopra UK goes shopping (again) to double size), comes the news that the parent company is to acquire a majority stake in Belgian banking management software firm, Callatay & Wouters. The company will be merged in with Sopra’s own banking software unit, branded Evolan, whose clients include Capita Asset Services.
I had a long chat with Sopra UK CEO, Pierre-Yves Commanay about the UK acquisitions, and it seems clear that Sopra is making a concerted push to become a notable player in the rather crowded banking software market. Readers with long memories might recall that Tieto’s UK financial services operations that Sopra UK has just acquired was none other than AttentiV, the erstwhile AIM-listed financial services software player previously known as Lynx Financial Systems.
Tieto acquired AttentiV mid-2005 (a year after its IPO), paying £56m. The prior year, AttentiV turned over £32m and was running a 10% operating margin. Well, what’s left of AttentiV is now turning over €22m (say £18m) and it seems rather unlikely that the margins are anywhere near 10% - or indeed that Sopra paid anywhere near £56m!
It has to be said, this is a bold move for Sopra. Competition in the banking software market is intense and the industry is consolidating (e.g. see Misys + Temenos – a game of five halves). Whether Sopra can shift some share its way is a big ask.