Capgemini Buys IBX

February 3, 2010

Having collaborated together since summer 2009, Capgemini and IBX decided to join forces in order to drive development of a new global procurement service offering and further expand the addressable market for IBX’s technology. The deal adds IBX’s strength in software-as-a-service purchasing technology to Capgemini’s global sourcing, business process outsourcing (BPO) and transformation expertise.

According to AMR Research, outsourcing of supply management processes has grown in recent years: “The market grew 30 percent in one year, driven by procurement and strategic sourcing services being offshored to India in record numbers.” With a solid track record on the BPO procurement area, Capgemini is ready to tackle this new growth opportunity and will make use of its Rightshore delivery network including strong offshore operations in India, China, Brazil and Poland.

IBX is headquartered in Stockholm, with 240 employees located across Europe and in the US. The company is a strong cash-generating company with 30 million Euros of revenues and an EBITDA2 margin of 16 percent. IBX operates 2 million purchase orders per year - a purchasing volume of 12 billion Euros - for more than 200,000 end users. Its clients include some of the largest and most recognized corporations in the world including Ericsson, Kraft Foods, IKEA, Deutsche Post DHL, LEGO System , Skanska and Deutsche Lufthansa.

“Joining forces with Capgemini strengthens our global capabilities, paving the way for the next generation of a Procurement-as-a-Service provider. Collaboration with Capgemini started in late summer and has been very positive. Capgemini’s competence within outsourcing and procurement and global reach is very impressive. When combined with IBX’s software-as-a-service purchasing technology platform, global supplier network and sourcing and procurement expertise, we will be able to provide even better solutions for our customers”, said Leif Bohlin, CEO of IBX Group and newly appointed head of the new, combined procurement BPO service entity.

“Procurement platforms can provide immediate gains for companies looking to outsource processes. In addition, we enable clients to manage their sourcing strategy on a global basis, helping them manage their business better,” said Hubert Giraud, global leader of Capgemini BPO. “Now that our unique offering provides the end-to-end capabilities from transformation consulting to global sourcing, organizations need only seek a single partner for procurement outsourcing. Not only does the fully integrated approach achieve significant savings faster, the required investment to recognize and achieve the saving is also less.”

The new end-to-end BPO procurement solution will include a full suite of products & services, including business process outsourcing, the software-as-a-service procurement platform, and an established global supplier network with more than 20,000 suppliers.

The transaction should be finalized by the end of February, subject to the approval of the relevant anti-trust authorities.