Transcript Press conference Warsaw, March 10

www.process4e.com | www.update.com
MCI Everest
Wroclaw, March 29th 2005
Uli Kottmann
CEO | Process4E S.A.
copyright © 2005 | update software AG
» March 9th 2005: update software AG acquires Process4E S.A.
Pressemeldung
update setzt europäischen Expansionskurs in Polen fort
update software AG übernimmt polnischen
CRM-Spezialisten Process4E S.A.
INFORMACJA PRASOWA
Wrocław, dnia 10 marca 2005
Up -to- date wyjście MCI z inwestycji
Fundusz MCI Managemet S.A. przeprowadził transakcje sprzedaży Spółki
portfelowej Process4E S.A. do zagranicznego inwestora strategicznego
W dniu 9 marca 2005 Fundusz MCI Management S.A. dokonał sprzedaży swoich 100% udziałów
/ 66,66% / w Spółce portfelowej Process4E S.A. do inwestora strategicznego, Spółki Update Software AG
z siedzibą w Wiedniu, notowanej na niemieckiej giełdzie we Frankfurcie nad Menem.Update Software AG
jest wiodącym europejskim dostawcą rozwiązań CRM, posiada spółki zależne w Niemczech, Szwajcarii,
Holandii, Francji, na Węgrzech i w Czechach.Transakcja gotówkowa sprzedaży opiewa na kwotę 4,5 mln
PLN. Przed transakcją sprzedaży fundusz przejął 56,70% udziałów w spółce Clix Software Sp. z o.o.
(www.clix-software.com), producenta systemów CRM dla małych i średnich przedsiębiorstw, w której
zamierza kontynuować inwestycje. Łączna wycena uwzględniając cenę gotówkową i przejęte aktywa
wynosi 4.900.000 PLN.
MCI Management SA zainwestowało w spółkę Process4E S.A. w okresie 2000 - 2001 i zrealizowało
bezpośrednio stopę zwrotu (około 290%) przy średniorocznej stopie IRR równej 28,29%. Process4E SA
było najstarszą inwestycją portfela funduszu z obecnie posiadanych w portfelu.
Operacja ta jest potwierdzeniem efektywności działania Funduszu i konsekwencji w realizacji założeń
strategii inwestycyjnej MCI. Jest to drugie wyjście z sukcesem z inwestycji w ciągu niespełna roku po
Travelplanet.pl S.A. / sprzedaż 25 % udziałów MCI w Spółce w czerwcu 2004 m.in.do instytucji
finansowych w ramach pre-IPO / oraz pierwsza sprzedaż do inwestora zagranicznego tego formatu .
Process4E S.A należy do spółek doradczych oraz integratorów CRM osiągających największe sukcesy w
Polsce.
Wien, Frankfurt, Warschau 10. März 2005 +++ Die an der Frankfurter
Börse notierte update software AG, ein führender europäischer
Anbieter von CRM-Lösungen, hat das polnische CRM-Unternehmen
Process4E S.A. übernommen. Das Closing der Übernahme, nach dem
update 100 Prozent der Anteile von Process4E hält, fand am 09.03.2005
in Warschau statt. Der Kaufpreis beträgt PLN 6,6 Mio. (rund
EUR 1,6 Mio.). Die bisherigen Eigentümer waren zu 67 Prozent die MCI
Management S.A., eine börsennotierte, polnische Venture Capital
Firma, und zu 33 Prozent der deutsche Gründer der Process4E, Ulrich
Kottmann. Nach der Gründung einer update Niederlassung in Budapest
Ende 2004 bedeutet die Übernahme des CRM-Unternehmens in
Warschau einen weiteren Meilenstein für die update Strategie in den
neuen EU-Ländern. „Process4E ist eine der erfolgreichsten CRMBeratungs- und Vertriebsorganisationen in Polen“, erläutert update
CEO Thomas Deutschmann die Expansionsentscheidung. „Durch die
Übernahme unterstreichen wir unsere Führungsrolle im CRM-Markt der
neuen EU-Länder in Mittel- und Osteuropa.“
Mit dem Kauf der Process4E S.A., die bereits seit Sommer
2004 Vertriebspartner von update ist, errechnet sich update
eine Zeitersparnis von anderthalb Jahren gegenüber einem
organischen Markteintritt. Das strategische Ziel der
Akquisition ist es, innerhalb der nächsten drei Jahre zum
Marktführer in Polen zu werden. Der Fokus der Process4E
S.A. (www.process4e.com) liegt auf CRM-Dienstleistungen
und -Lösungen, mit denen die zurzeit 11 Mitarbeiter des
Unternehmens mehr als 70 Prozent des Umsatzes erzielen.
Seit der Gründung im Jahre 2000 hat Process4E mehr als 60
Kunden betreut, die meisten davon große mittelständische
Unternehmen aus den Branchen Handel, Produktion und dem
Dienstleistungssektor. Eine weitere Kernkompetenz des
Unternehmens liegt in der Prozessanalyse. Process4E hat
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
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» Agenda
20 Minutes about …
• Update Software AG
• Process4E S.A.
• Expectations & Motivations
• Timelines
• Key issues & challenges
• Year-end fight
• The deal
• Key success factors
• Recommendations & learning's
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
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» update software AG – overview
For our staff and partners, »go relate« means commitment and open
communication. Valuing everyone’s individual contributions. Pursuing
and achieving common goals. An active exchange for motivational drive.
»go relate«
the driving force for mutual advantage
Business
—————————
Foundation
—————————
Customers
One of Europe‘s leading
Customer Relationship Management vendors
1988 in Vienna, Austria (Frankfurt Stock
Exchange)
>750 customers, >80,000 user
—————————
Employees
<>150 employees in 7 subsidiaries (A/D/CH/NL/F/CZ/HU) + Process4E
—————————
Product
“marketing.manager 6”
—————————
Technology
—————————
Languages
Client-Server / Web / PDA / Telephone integration
Interfaces to all front office and back office solutions
“marketing.manager” is available in 18 languages
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
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» > 750 customers | > 80.000 users worldwide
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
5
» Process4E S.A. – now a subsidiary of update software AG
Established July 2000
Joint Stock Company (SA)
 2.5 Mio PLN S-capital
 Founding Shareholders
66,66% MCI S.A.
33,34% Uli Kottmann
Business
 CRM Solutions & Services
Mission
“We help our customers by
competing better”
 Business Process
Management
 Strategy Consulting
 Project Management
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
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» strong experience in all relevant fields
Over 60 customers
2/3 for CRM services &
solutions
Dedicated to CRM
Signed contracts for > 600 Enterprise
class CRM licences in 2004
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
7
» Why “update” - from first contact to “marriage”
.. Vienna
Romance …
 excellent products
 17 years of CRM experience
 focused on CRM
 focused on Poland and CEE
 excellent customer base
 outstanding support
 same “wave length”
 “size” match
 trust & respect
 similar attitude to values & business
ethics
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
8
» Key expectations & motivations
Uli Kottmann
• Establish a
profitable presence
in Poland
• 1.5 years time to
market advantage
• Fair and realistic
price (low)
• Lowest possible
deal risk
• Process4E team
and management
continuity
• Invest in market
development and
not in subsidizing
Process4E current
operations
• Maximizing the exit
value
• Customer and
project continuity
• Clear commitment
to update
• Maximize cash-flow
• Protect team
• Minimize
guarantees
• Investment in team
know-how and
training
• No disturbance of
my vision of the
“profitable &
human enterprise”
• Positive PR and
Stock Exchange
information
• Continue positive
relations to Uli
Kottmann
• Clear Roles and
Responsibilities
• No additional
admin burden due
to new shareholder
• Investment of
Update in
developing the
business
(Marketing, Sales)
• Career
opportunities
• No interference to
my people (I
manage the team)
• Keep long-term the
direct or indirect
control over
Process4E and Clix
Software
• Clarity over
personal future and
clear exit conditions
(no gray zones)
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
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» Timelines
8 Month to close
the deal
05 – 2004
First contact reg. partnership
05 – 2004
Partner contract signed
08 – 2004
First contact reg. acquisition
09 – 2004
UK proposes 1st deal construction
09 – 2004
TC and UK visit Vienna
10 – 2004
Update SpvBd meeting rejects
10 – 2005
UK decides to sell
10 – 2004
LoI
11 – 2004
Legal and tax due diligence
12 – 2004
First 2 customer contracts
01 – 2005
Financial audit 2004 (10.1)
01 – 2005
Update & MCI SpvBd agree
02 – 2005
Contract workshop in Warsaw
03 – 2005
Acquisition
03 – 2005
Sell Clix Software Ltd.
04 – 2005
First financial report Q1 to Update
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
10
» key issues & challenges
Multiple complexities
and issues had to be
solved
Contract structure
Applicable law & court
Meet 2004 financial
objectives
Guarantees
Due Diligence
Country risk
Valuation methods
Timing
Distance & Language
2 public companies
Cash vs. shares
Triangle construction
with 1:1 side letters
Manage the business
and the “deal”
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
11
» The year end fight
Base
Update's
Actuals
Actuals
numbers for
Expectation Sept-2004 Dec-2005
valuation
Revenue
3,562
2,013
3,588
Cash
2,479
703
2,340
Receivables
445
260
878
Sh. Term-liab.
-290
-174
-548
Sub-total
6,196
2,802
6,258
Profit before tax
positive
-775
53
Sell Okay CRM to Clix
Maximize customer deals
Sell MCI shares
Loan to Clix Software Ltd.
Tight collection process
Reduced cost (salaries,
etc.)
Day-to-day project
management
Around 100 individual
transactions
Excellent team-work
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
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» The deal
High quality exit and
a return which is
within VC ‘s
expectations
MCI
• Price 4.5 Mio PLN
• Cash 3.3 Mio at signing
• Cash 1.2 Mio at YE
• 57% of Clix for 0,67 PLN
UK
• Price 515 kEuro
• Cash from 05 to 08
• 3 Years earn-out model
• 3 Years contract as CEO
• 28% of Clix for 0.33 PLN
• Rights to Process4E name
MCI and UK
• Reps & warranties risk
Employees
• Update Stock options
• Development
• International standards
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
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» Key success factors
Skills &
Attitudes to
close such
deals
Behaviors
• Trust - no hidden agenda – no “bullshit”
• Be realistic and focus on the big picture
• Understand all expectations & motivations
• Respect for each parties position
Skills
• Tight project management & milestones
• Strong legal, business and financial skills
• Close minor gaps > compromises 1:1
• Be persistent & drive the process
• Expect problems & propose solutions
• Bridge the cultures
Key success factors
• Our value was not our balance sheet but the team
know-how, continuity, attitude, culture & vision
• We met the financial expectations at year-end
• We were “clean” and had the proper internal
controls in place
• We managed the acquisition process in the
interest of all parties
• I focused 100% on the deal
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
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» Recommendations & Learning's
Values are larger than
money
You can drive the exit,
not only the VC
Intangible assets can be
equally or more important
than hard facts and numbers
Long term ethical behavior
pay’s back (employees,
customers, vendors etc.)
You cannot fix in 3 month
what you screwed up in 3
years
Follow your vision and do not
make quarterly compromises
Priorities: 1. Customers, 2.
team, 3. shareholders, 4.
management
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
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» Thanks
Thank You!
• Tomasz Czechowicz
• Kasia Figat
• Roman Cisek
• Marek Piatkowski
• Andrzej Jasieniecki
• And all other MCI staff!
• Ryszard Ptasiñski
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
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» LOJALNOŚĆ KLIENTA
Ready, steady, »go relate«! Sounds good. Feels good. Because relationships determine our lives. And our actions. Both professionally and personally. The world turns around them. We do too. We live relationships. »go relate«
copyright © 2005 | update software AG |
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