Another Basware acquisition – Certipost – makes them Big in Belgium

Basware, the Finnish e-Invoicing, P2P and network solutions provider (and one of the largest firms globally in this market) has just announced the acquisition of the network and e-Invoicing business of leading Benelux operator Certipost.

Certipost are a subsidiary of bpost, the rather fashionably named Belgian postal service. It looks like Certipost do a range of products, including for instance electronic identification – from their website:

One Certipost product is carried by all Belgians. The chip in your identity card holds two digital certificates. With these e-certificates you can identify yourself online, sign e-mails and submit your personal income tax return”.

But we assume that the acquisition does not include these elements of the Certipost business, so presumably they will be splitting out the network / e-invoicing side and leaving the remainder unchanged as Certipost. Although looking at the headcount levels (see below) it doesn’t appear that there will be much left!

The net sales of the acquired business are expected to amount to approximately EUR 8.5 million this year, and “the initial acquisition price of approximately EUR 18.2 million will be paid in cash on the closing date”. The final acquisition price will be based on the audited 2012 annual accounts. Paying cash means Basware, who are quoted on the Finnish stock market, don’t need to issue more equity obviously. The share price so far today is virtually unchanged at around EUR 22.

So the price represents 2x revenues, which doesn’t seem bad, and is certainly a whole lot less than the approximately 10x SAP paid for Ariba – although of course Certipost has nowhere near the brand or product range of Ariba. Even so, this looks like a sensible geographic “fill-in” acquisition – what we don’t know yet is whether Certipost brings any interesting technology that might feed into wider benefits for Basware.

In terms of the market reach, the press release says: “Certipost had more than 85,000 companies using its technology to exchange documents electronically and it reaches over 100,000 companies in Europe through roaming. Certipost employs currently 84 people, of whom 76 employees work in the network and e-Invoicing business”.

The acquisition adds around 12 million transactions to Basware’s global Open Network, and puts them in a very strong position in Benelux. Their strategy appears to be based on acquiring quite small businesses, but ones with strong positions in local markets; you may remember they acquired First Businesspost GmbH earlier this year, who were similarly powerful in Germany (at a higher revenue multiple than this deal, incidentally). So whilst they’re not as high profile as firms like SAP, Oracle, Ariba and IBM, Basware are making steady and interesting progress in the P2P and e-Invoicing world.

I’m sure my US colleagues will be doing a more detailed assessment later on Spend Matters US and I suspect on our PRO subscription site – essential reading if you want to get behind the headlines and understand the implications of this and other developments in the procurement and supply chain  technology world!

(Declaration – I don’t own any shares  or hold positions in Basware).  

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