Tivit has agreed to acquire Chile’s technology integrator Synapsis for US$150 million in a deal that will make the Brazilian firm a dominant player in Latin America’s information technology market.
Santiago-based Synapsis employs about 1,500 people and has half a dozen data centers across the region, including in Colombia, Brazil, Argentina and Peru. Founded in 1988 as the captive IT services arm of the Endesa Group, Synapsis is believed to have to more than 320 customers in the region.
“Besides international expansion, this operation will also bolster Tivit’s position in Northeastern region of Brazil, where Synapsis has a data center,” said Luiz Mattar, CEO and co-founder of Tivit in a statement.
The merger, analysts say, makes Tivit a billion dollar technology firm, arming it with strong enough expertise to challenge the clout of U.S. technology giants such as IBM. The company will operate under the brand Tivit-Synapsis in Latin America, with the exception of Brazil, where it will retain its name.
The merger also allows Tivit to cross-sell a number of its main services. Synapsis offerings include IT infrastructure outsourcing, development of applications, SAP solutions and smart systems.
Synapsis stated that the merger will take Tivit’s total staff to 26,500 people. As a result of the deal, Tivit will gain five data centers: three in Chile and one each in Colombia and Argentina, in addition to the four it is currently operating in Brazil.
Synapsis also has delivery centers in Panama and Ecuador, and its customer base includes many of Latin America’s most important organizations in the utilities, oil & gas and government sectors.
However, the deal is yet to be approved by Brazil’s anti-trust regulator CADE. Therefore, Tivit said it would start integrating Synapsis only after it gets the stamp of approval from CADE.
According to the International Data Corporation, Argentina, Brazil, Chile, Colombia and Peru account for 85% of South America’s IT services market, which is growing between 10 and 20% per year.