NEC will promote the global reach of KMD’s software by utilizing the NEC Group’s sales channels.
Headquartered in Minato, Tokyo, NEC Corporation has announced to acquire KMD Holding ApS, the holding company of KMD A/S (KMD), the largest Danish IT company. Reportedly, NEC is acquiring KMD for approximately 8 billion Danish Kroner (DKK) from Advent International, one of the world’s largest and most experienced private equity investors. The acquisition is expected to be completed by the end of February 2019.
The deal to support NEC’s management plan
This acquisition will accelerate NEC’s global safety business, which it has positioned as a growth engine in its three-year medium-term management plan, the ‘Mid-term Management Plan 2020,’ and is promoting a shift towards service businesses that utilize horizontally deployable platforms.
Moreover, under its ‘NEC Safer Cities’ program, NEC is also enlarging its business domain through the utilization of its advanced biometrics and artificial intelligence (AI) technologies to develop areas that include public safety, digital government, and smart transportation.
KMD mainly provides software and IT services in Denmark through business models that generate profit continuously on a recurring basis, such as software as a service (SaaS) offerings. Specifically, KMD has a strong customer base among central and local governments and has a wide variety of software for supporting the digitization of Denmark.
Takashi Niino, President and CEO, NEC Corporation, stated, “Denmark and the United Kingdom are considered European role models for the implementation of unified digital government measures in order to improve administrative services and reduce costs.” Moreover, he added, “Through this acquisition, NEC will acquire a business model that leverages platforms in the digital government domain as it aims to expand business from northern Europe to the whole of Europe and globally.”
The acquisition to come up with even better and robust solutions
Eva Berneke, CEO, KMD, said, “This is an historic moment for KMD. Becoming a part of NEC will give KMD a new and very robust platform for the strategic development of our business. NEC develops cutting-edge technologies and has a global organization with strong capabilities,” she added, “NEC is a world-renowned brand and like us has a strong history when it comes to the development of society through technology. NEC focuses on solutions for society and we are proud that NEC acknowledges our competencies in this respect. We look forward to working together on achieving new common goals and making even better products for our customers.”
According to reports, NEC sees the acquisition as a good match with its strategic ambitions within the public sector. KMD has solid experience and a strong portfolio of software in this market segment. NEC technology and KMD software have many synergistic opportunities and both parties will benefit from the exchange and integration of products, know-how, and competencies. NEC expects its cutting-edge AI technologies, ‘NEC the WISE’ and its biometric technologies, ‘Bio-Idiom’ to be among the areas of great mutual opportunity.
Lately, NEC has collaborated with Samsung in order to explore new 5G business opportunities in the global market.
