The Belgian IT market is ripe for M&A

The adverse effects of the pandemic on the wider Belgian economy, originally predicted by the National Bank of Belgium as roughly three times worse than during the 2008-2009 global financial crisis, is not as damaging as initially thought. Still, the impact of COVID on the labor market led to about 100,000 jobs being lost by autumn 2021. Thus, business investment recovery is expected to remain somewhat slow. Despite this, the ICT market in Belgium has not been sitting idle.

According to Corporate Finance International (CFI), the number of ICT M&A deals in 2020 showed 42 deals in Q1, 38 in Q2, 29 in Q3, and finishing the year with 53 in Q4. The momentum kept going in Q1 of 2021, with another 38 transactions registered. 

What is fuelling these transactions, and why are companies broadening their capabilities and solutions during difficult economic conditions? Despite the pandemic affecting all sectors and sub-sectors, the IT world has experienced mixed results. On the one hand, those with a strong legacy base have seen a significant drop in business and revenues. On the other hand, vendors with cloud and cloud-native solutions capable of supporting clients to go live remotely have seen strong growth.

Additionally, businesses from all verticals were confronted by the limitations of their IT environment once local lockdown measures prevented their employees from working and accessing their workplace. This led to an accelerated digitalization process across workplace solutions, collaboration tools, cloud-based horizontal apps (ERP, HCM, etc.), and infrastructure. The overall aim is to drive adaptability, agility, and operational resilience.

A few examples of acquisitions that have taken place in the Belgian ICT market in 2020 include IT provider Cegeka’s acquisition of Citymesh (Dec 2020). Citymesh is a local telecom provider, accelerating Cegeka’s innovations and connectivity capabilities in the 5G space. Software provider Netflow Software acquired  Accel, a provider of ICT management, service desk, cybersecurity, backup services, and cloud & ICT infrastructure (Nov 2020).

There were also several acquisitions made in Belgium by external IT businesses, including Dutch-based Cloudwise’s acquisition of Rhombus, a provider of a digital learning and teaching platform (Nov 2020), Qlik Technologies‘ acquisition of, a provider of iPaaS (Oct 2020), or Solera’s acquisition of Innovative Systems Provider (InSyPro), a body shop management platform provider (Dec 2020). Furthermore, we have seen a string of acquisitions by private equity firms, including Ackermans & van Haaren’s 20% stake in OMP, a supply chain planning solutions provider (Nov 2020).

PAC expects the M&A trend to continue during 2021 as the Belgian market presents significant opportunities. We observe IT engagements and opportunities in the Belgian market to be smaller in scale but more abundant than, for example, the Netherlands, where the overall IT maturity of businesses is more significant. PAC also sees large IT players, including Wipro, expanding local resources and capabilities in the Benelux, demonstrating confidence in the region.

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