CMC and FPT make M&A deal to enhance strengths

Two giants in information and technology (IT) sector namely FPT and CMC recently revealed a plan to make merger and acquisition (M&A) deal in coming time.

Accordingly, the CMC Technology Group will spend over $20 million for this M&A deal, said Nguyen Trung Chinh, CMC’s general director at a seminar on IT and telecommunications held in Hanoi recently.

Also according to Chinh, CMC will invest or buy back companies that already have commercial products or services with clear business model and suitable to CMC’s development orientation.

Previously, CMC made two M&A deals with a total value of about $100 million.

Chinh said that CMC is not a financial investor but a technology investor so the M&A method will also be different from financial investors. Hence, CMC will have to choose technology firms that have suitable strategy to make M&A.

Apart from ambition of making M&A deals to enhance the strength, CMC also aims to be included into the group of firms with revenue of $1 billion in the future.

Chinh said that in 2010, his firm targets to bring five trillion dong in revenue and it is expected at $500 million in 2012 and minimum at $800 million in 2015.

Most recently, CMC has been ranked at the 32nd in Top 500 private firms in Vietnam in 2010 by the Vietnam Report Co, increasing 11 grades against the ranking board in 2009.

In the beginning of next year, CMC plans to launch some new technology products in sectors or smart phone and handheld digital devices such as Vietnamese brand iPad.

In next five years, CMC’s products are expected to account for 10 percent of the domestic market share.

Chinh affirmed that if being supported by 30 percent in price, CMC will be able to provide about one million laptops priced at less than $200 for consumers.

Meanwhile, FPT also announced its M&A plan in coming time whereby the firm will make focus on software sector.

FPT also rents a company to seek opportunities in some foreign markets, especially markets that have rapid economic recovery ability.

“The total amount of capital FPT plans to pour into the M&A deal in software sector will not lower than $10 million”, said Phan Duc Trung, FPT’s vice general director.

Earlier, to enter the mobile telecommunication market, FPT in collaboration with its offshoot namely FPT Telecom bought 60 percent stake into EVN Telecom.

According to Nguyen Truong Tung, FPT University’s rector, the group expects to become a global company with a profit of 10 trillion dong in 2014 and be included into the Forbes 500 in 2025.

In the software and service fields, FPT plans to gain a revenue of $500 million in 2015 and exceed the threshold of $1 billion in 2020. This year, FPT’s revenue from software and service is expected at about $100 million, said Tung. – Bao dau tu

Tags: CMC, FPT