• Chesapeake Group

Technopro to acquire Robosoft



Overview:


On 10 August 2021, Technopro announced that it will acquire Robosoft, a full-service digital transformation company for $108m.


The acquisition is in line with Technopro’s growth strategy to add overseas offshore delivery capabilities with engineering expertise which will be used to support the company’s core business in Japan.


It enhances Technopro’s digital solutions portfolio across key sectors like media & entertainment, BFSI and retail / e-commerce.


About Technopro:


Founded in 1997, Technopro is a technology-focused staffing and services company specializing in IT, engineering and R&D services.


It offers services for design and development, project management, research and technical consulting across automotive, electronic equipment, semiconductor, telecommunication, aerospace and biotechnology domains.


Based in Tokyo, Japan, Technopro recorded $1.43bn revenue in FY 2020(1) with 18,896 employees worldwide.


About Robosoft:


Founded in 1996, Robosoft is a leading digital transformation company backed by Kalaari Capital and Ascent Capital. It recorded $24.7m revenue in FY 2021(2).


It offers advisory, design, engineering and analytics services to clients in the BFSI, media & entertainment and retail / ecommerce verticals.


It is headquartered in Udupi, India with 4 sales offices in US and Japan and 2 delivery centers in Bengaluru and Mumbai.


Rationale of the transaction:


The transaction will be completed at an enterprise value of $108m, representing an EV / Sales multiple of 4.4x and EV / EBITDA multiple of 11.0x based on FY 2021(2) financials.


Kalaari Capital generated an IRR of 21.4% on its $6m investment in Robosoft at a money multiple of 4.8x whereas Ascent Capital generated an IRR of 23.9% on its $10m investment in Robosoft at a money multiple of 4.0x.


The transaction will be completed in 2 phases wherein the first tranche of 80% shares will be transferred and the remaining shares will be transferred in Jul 2022.


Technopro will leverage Robosoft’s UI/UX design and advisory capabilities to enhance its existing solutions for the manufacturing vertical and grow its current business by utilizing Robosoft’s strong engineering expertise.


It will also expand Technopro’s global footprint with the addition of several key accounts based in US, Europe and India.


Robosoft’s current management team will continue to lead the firm and Ravi Teja Bommireddipalli will be elevated to the MD and CEO position.


The Chesapeake Group was not an advisor in this transaction.

(1) YE: Jun

(2) YE: Mar