ACT Group Plc plans to leave its new BIS Group Ltd acquisition (CI No 2,195) fairly intact, although certain businesses within the enlarged company that don’t fit in long-term will be sold. ACT’s chairman Roger Foster, declined to comment on which ones were most likely to get the chop, but added we won’t rush into it. Nonetheless, he did say that the group intends to continue focussing on its financial software activities – which now make up about UKP140m of the two companies’ UKP270m combined turnover as well as its more general software and services offerings. He also wants to acquire more companies in time, but probably not for the next couple of years or so because digesting this one will be quite challenging. Foster first made contact with BIS about 18 months ago, making it clear to owner Nynex Corp, the New York and New England phone company, that if they were interested in disposal, we were interested in acquisition. Then, about six or eight weeks ago, Nynex’s bankers, Lazards, approached him, and the rest, as they say, is history. From Birmingham-based ACT’s point of view, the acquisition was perfect because the group has constantly been trying to build up the international side of its business, particularly in the increasingly global world of finance. BIS currently generates some 85% of its revenues overseas, which means that about half of ACT’s total turnover now comes from international sales.
Worldwide mass
We’ve now got the worldwide mass we’ve been looking for, said Foster. And while he intends to make some savings immediately in such central costs as administration, his plan is to keep the three divisions that make up BIS relatively autonomous. At this stage, he says, we’ve got to win the hearts and minds of staff at a company that is profitable in its own right, and introducing sweeping changes is not the way to do it – with a people business like software, alienate the staff and you find you’ve bought a few buildings in a time of chronic property surplus. BIS consists of three operating units: banking systems; information systems; and Brann direct marketing. Banking systems, which generated 43% of the firm’s UKP105.4m 1992 turnover, sells financial software to international banks together with related services and maintenance. Its flagship product, Midas, comprises 40 modules addressing specific banking functions, such as capital markets, risk management and treasury. The division has more than 500 customers in 70 countries and employs about 600 staff. Information systems, which brought in 39% of total BIS revenues last year, has three main areas of operation: consultancy and solutions, targetting government, finance and utilities primarily; information technology and management training; and systems operation, which undertakes facilities management. It has 590 employees. Finally, Brann devises direct marketing strategies, produces direct mailing programmes, and manages data for sales and marketing purposes as well as telephone programmes to monitor customer responses and feedback. It is run as an autonomous unit with some 380 staff, and some believe that it may be the first piece of BIS that ACT will sell on, though with ACT’s striking good fortune – it hasn’t looked back since it sold Apricot Computers – it may turn out to be a goldmine.
