SMS Technology bolsters integration arm

ASX-listed SMS Management and Technology has acquired privately held IBM partner Renewtek.

The value of the acquisition was not disclosed but CRN understands that the transaction type is a mixture of cash and scrip, depending on performance.

SMS said the annualised contribution from Renewtek will be $17.3 million and $2.5 million in earnings before tax depreciation and amoritisation.

Renewtek, an IBM Filenet solution specialist, provides enterprise content management (ECM) and business process management (BPM).

SMS planned to integrate Renewtek into its systems integration practice, one of seven existing practices. The acquisition was in line with the company's strategy to extend on the system integration services.

"We've made that clear in the market," SMS spokesperson Matthew Kaufman said.

"SMS has a strong system integration arm and the acquisition brings deeper expertise."

SMS is also an IBM partner with experience in middleware applications in the IBM stack as well as Tibco and Oracle.

SMS chief executive Tom Stianos said the company was "impressed by the maturity of the Renewtek business".

"Renewtek has a strong sales pipeline in markets where SMS is already delivering other services and their development tools will further strengthen our foothold in the financial services sector.

Meanwhile, SMS has gained ownership of Renewtek's "dedicated development and support centre" in Vietnam. The Vietnam office will add to its Asian presence, which at its peak was about 150 consultants.

"We've always been present [for] Australian clients in Hong Kong. In Vietnam we've acquired the offshore development team that does a particular part of our project work.

"It's for Australian-based clients that are providing deeper development expertise.

"We're not trying to service all of Asia, we want to expand into Asia off the back of domestic clients," Kaufman said.

All 140 Renewtek staff plus three Renewtek principals, Fergus Porter, Craig Mullan and Patrick Lehane, who are taking up leadership roles at SMS, will move across.