Earlier this week the European Bank for Reconstruction and Development (EBRD), the Russian Direct Investment Fund (RDIF), and the Capman Russia II Fund announced a $100 million investment in Maykor, a leading Russian IT outsourcing company.
The RDIF led the effort with 50% of the total investment, while the EBRD and Capman each contributed $25 million. Market analysts believe that the investor consortium may receive a collective 20-25% shareholding in the Russian company after a planned follow-on offering.
With the help of this financial injection, Maykor is now aiming to control a larger share of the Russian market with a particular focus on extending its geographic reach across the country via M&As and portfolio diversification.
Set up just three years ago, Maykor has asserted itself as an important player on the Russian IT outsourcing market. The outsourcing sector is now the primary locomotive of the IT market growth in Russia, according to a July study by IDC, a global research and market intelligence provider. The company provides one-stop-shopping servicing of IT equipment, facility systems, and business applications through a network of 83 regional branches and more than 400 servicing subdivisions across Russia.
For the RDIF, a $10 billion fund established by the Russian government to make equity investments primarily in the Russian economy, the Maykor deal represents its inaugural investment in Russia’s IT business. Kirill Dmitriev, the CEO of the Fund, underscored that in testing the sector waters the RDIF clearly saw the potential of both the vibrant IT outsourcing market, which grew at a CAGR of 15% last year, and the new portfolio company itself, which is already the dominant market player with a client base of more than 1,000 customers willing to outsource some or most of their IT functions to professionals.
“The company is well placed to extend its position as a market leader,” Dmitriev said. Maykor is forecasted to expand its business “by several times” over the next three to four years and to grow strong enough for a Moscow-based IPO in 2016.
According to RDIF’s CEO, the presence of its “top tier consortium partners” helped the Russian government fund finalize its decision to co-invest. The EBRD and Capman Russia, the Russian PE division of Helsinki-headquartered Capman Group, pooled efforts earlier this year to launch the $124 million Capman Russia II Fund to invest in small and medium-sized companies. “The Maykor transaction represents this new fund’s first investment,” the EBRD said.
