Acquisition of Cálculo will enable Sapiens to enter the Spanish and Portuguese market as part of its long-term growth strategy
Insurance industry software developer Sapiens International has signed an agreement to acquire Spanish insurance consulting and managed services provider Cálculo for an undisclosed amount.
Sapiens views the acquisition as its first step in its journey to enter Spain and Portugal, as part of its long-term growth opportunity in the region.
Established in 1966, Cálculo possesses more than 150 insurance experts and 25 insurance company customers in Spain. The company serves several blue-chip companies, which are expected to help in continuing its global expansion by entering the Iberian market.
Sapiens will continue to support and invest in Cálculo’s portfolio
After conclusion of the deal, Sapiens will continue to invest in and support Cálculo’s products such as the e-Tica core system and other solutions for existing and new customers. The company also aims to introduce its leading products based on market segment, such as life and pension and property and casualty, and different tiers. Sapiens’ solutions will also be provided to Spanish global customers.
Sapiens president and CEO Roni Al-Dor said: “This acquisition was a relatively simple decision, as it is expected to accelerate our global footprint by helping us enter the sizeable Iberian market.
“It checks all the boxes of our M&A growth strategy: it enables us to expand geographically, grows our customer base, and adds a talented team of experts, as well as complementary capabilities and services to our portfolio.
“We see this acquisition as the catalyst for long-term growth opportunities that will be sustained by selling Sapiens’ core and digital suites to a market with a high percentage of in-house systems.
“Additionally, the company will further improve our existing products and services by onboarding Cálculo’s team of experts, consultants and solutions. Sapiens looks forward to welcoming the Cálculo team and creating value for our customers and shareholders.”
The primary goal of the deal is to expand Sapiens presence in the Spanish market in the long-run. Cálculo’s expected full-year 2019 revenue is about $10m, with break-even profitability.
The deal is expected to be accretive to profits by the end of next year. Sapiens stated that it will pay cash consideration based on valuation of less than one time revenues.
Cálculo CEO Diogo Moraes Sunyer said: “This acquisition will offer the Cálculo team and clients access to innovative technology, a global network of relationships and extensive resources.
“Sapiens will benefit from Cálculo’s experienced experts, local market knowledge and the close relationships we have built and maintained in Spain. We look forward to transitioning into the organization as seamlessly as possible and creating a successful future together with Sapiens.”
Earlier this month, the insurance software developer partnered with FRISS, an AI-powered fraud and risk solutions provider for the property and casualty (P&C) insurance industry.
The partnership is part of the company’s strategy to help its customers mitigate risk and reduce fraud, improve customer journey for low-risk policies and claims and make new insurtech solutions easily available to its customers.