'Small companies want to acquire overseas

Can we have a background of your company. Who are your clients?

Founded in 1987, the Chesapeake Group has affiliates in London and Paris.
The firm has more mid-market IT services experience than any other advisor in
the same league. The Chesapeake Groups clients include Covansys, Zensar
Technologies, Valtech, TechTeam, Sento Corporation, Softtek, Answerthink, and
eIndia Venture Fund, among others. The Chesapeake Group would soon set up an
Indian office to assist its India clients with corporate development and
strategic initiatives.

What will be your focus in India?

The Chesapeake Group is a focused and relationship-driven organization. We
set up the operation in India taking into account the tremendous growth in IT
services business. Seventy-five percent of our transactions are in this space.
We advise mid-market companies ($75 mn to $250 mn) to look for M&A
opportunities. We have, on earlier occasions, advised Covansys, Zensar, Valtech,
and others.

Douglas S Land, MD, Chesapeake Group

What are the key trends in M&A among technology companies?

One clear-cut trend that is emerging is that smaller companies are now
aspiring to acquire companies overseas. The main driver for this kind of
thinking is that these ambitious companies are primarily looking at expanding
their reach and access to newer markets and acquire delivery capability. They
are also doing it to be closer to clients. Another thing these companies are
looking at in the companies they are planning to acquire is their ability to
fill in some of the gaps that are there in the companys offerings.

What kind of advise do you give to your clients?

Our service offerings are four pronged. First, we advise companies on
strategy by understanding their objectives. This is followed by the
identification phase, wherein we help them identify potential acquisition
targets. Then comes the execution phase, where the actual M&A takes place. This
is followed by post-acquisition integration challenges, for which we offer our
services.

What are some of the integration challenges that you have encountered
while advising on deals?

The success of any transaction depends on the commitment to people (of the
acquired company) and to ensure that the key talents in the organization feel
comfortable. It is equally important to ensure a valuable career path for the
employees.

Sudesh Prasad

sudeshp@cybermedia.co.in