With the merger, the company will represent 38% of the domestic market

By: Thaís Trapp

Sao Paulo, July 24, 2008 ? Last Thursday morning, the 24th, an important merger was announced in the Information Technology industry. Totvs and Datasul merged to create the ninth largest IT company in the world and the largest in developing countries. ?They are calling it the InBev of software? said Datasul's council president, Miguel Abuhab, comparing the acquisition to one of the largest beer manufacturers in the world, which owns a large number of Brazilian brands.

The corporate reorganization of the companies corresponds to a R$ 480 million investment by Totvs benefiting Datasul's former investors. The amount equals the total payment for the redemption of the preferred shares of Makira, a subsidiary of Totvs, and for any Datasul dividends that may be declared.

According to Laércio Consentino, President of Totvs, the united companies will retain 38.03% of the domestic market and will be the second largest IT company in Latin America, with gross revenue of R$ 778 million and a net profit of R$ 114.5 million in the last 12 months. ?The merger ensures a greater scalability for both companies, which will now offer solutions to meet the needs of medium and large companies?, Consentino emphasizes.

It is estimated that the transition period will last six months and that at the end of the negotiations both brands will remain. ?Our chief concern in communication. What each will get out of this acquisition?, stated Jorge Steffens, President of Datasul. ?We need a synergy process and a human process in order to achieve the union of both teams?, he concluded.

New phase
Both companies? channels will function independently, but operations in foreign markets will be developed jointly. ?We will establish a plan for each country? explains Consentino. According to him, the sharing of good practices, the expansion of services and product lines, the benefits generated by synergy and the talents of both teams will drive the operational growth of both companies.