Here I look back at how M&A activity has impacted the IT services industry over the past year and make a few broad predictions for the type of activity to be expected in the next twelve months. 2016 had been marked by some large M&A announcements, with: Hardware companies moving out of services:  HPE announcing the sale of Enterprise Services to CSC (completed i[...]

  CGI recently briefed NelsonHall on its capabilities for the manufacturing sector and how it is addressing opportunities around digital manufacturing/Industry 4.0. CGI’s service portfolio for digital manufacturing addresses the manufacturing sector also other industries with similar needs around supply chain and distribution operations, including retail/distribution, and life[...]

M&A activity in IT services is set to take a new direction in 2017. Here, I reflect on M&A activity by the largest IT services vendors in 2016, with its emphasis on mega deals, and look ahead to 2017, which is set to be the year of digital & security tuck-in acquisitions. Large M&As in 2016: IT Conglomerates and Defense Firms Divest IT Services Arms Large-scale M&am[...]

In August 2015, we asked ‘Is CGI Ready to Pull the Acquisition Trigger?’It’s been four years CGI’s last big acquisition (Logica), and CGI watchers are still waiting to see what big move CGI will make next. Here I take a look at what’s driving CGI’s growth plans, and what we should expect next. As a consolidator, CGI positions on taking a long-term strategic v[...]

CGI's Q3 FY 15 results included: Revenues of CDN$2.56bn, down 3.5% y/y in CC and flat sequentially Adjusted EBIT margin of 14.5%, up 167 bps y/y Full results are available here. The y/y CC revenue decline (the same as in Q2) is attributed to the wind down of U.S. government healthcare projects, continued delays in U.S. federal procurement, and the slowdown in U.K. government sp[...]

CGI CEO Michael Roach describes Q1 FY 2015 results as “strong”– and yet revenue was down in every region apart from the U.K. (putting aside the 0.9% CC growth in APAC to CDN$108.7m).  The 169% book-to-bill ratio achieved this quarter looks a lot less impressive when the CDN$2bn renewal with Bell Canada is excluded, when the global book-to-bill goes down to 90%[...]

NelsonHall recently attended CGI’s global analyst event in London. The key messages in CEO Michael E Roach’s keynote were the success with which CGI is executing on its "Buy and Build" profitable growth strategy and that the expected benefits of the merger are now becoming more visible. At the same event last year, CGI indicated some of the measures it was applying to impr[...]