Austrian group Kapsch, with EUR830 million in turnover in fiscal year 2010, will invest between EUR7 and EUR10 million to develop the Romanian subsidiary, Dan Roman, general manager of the local subsidiary, told a news conference. He said the company’s revenue target is EUR15 million in three years.
Founded in 1892 as a telegraph manufacturer, Kapsch is a family business that has expanded across several countries in the region and has three divisions: the IT&C integrated solutions (BusinessCom), the one that provides equipment and solutions for telecom operators and railway communications solutions (CarrierCom) and another which offers solutions, equipment and highway tax collection services (TrafficCom).
“Romania will be at the center of Kapsch’s strategy for this part of Europe over the next few years,” Kari Kapsch told a news conference in Bucharest, at the company’s official launch on the Romanian market.
The Kapsch division that targets EUR15 million in turnover within three years in Romania is BusinessCom, but the Austrian group is also fighting to get a contract with Romania’s railway administrator, which is set to make significant investments over the next few years in modernizing systems and infrastructure to EU standards.
After it bought assets from Canada’s Nortel in 2009, Kapsch became the world’s largest supplier of GSM solutions for railways (GSM-R).
Moreover, Kapsch also plans to take part in an auction to be organized in Romania for the introduction of a road taxation system, after the company has won several projects of this kind worldwide.
“If there is a crisis, what do Governments want? Money. And a solution to get funds is to introduce highway taxation systems,” Kari Kapsch said.
As for the BusinessCom division in Romania, it could use the expertise of local IT specialists for projects conducted on other international markets, said company representatives.
Up until then “our short-term strategy is to win as many contracts with a recurring business as possible, which should give us the necessary stability to develop our own solutions. We don’t plan to make extraordinary revenues in a few years, but to make profit,” said Dan Roman, general manager of Kapsch Romania.
He added that another priority, apart from talks with Austrian companies present in Romania, is to take part in auctions organized by state institutions.
In Romania, Kapsch competes both with local subsidiaries of IBM and HP, and with Austrian-controlled companies such as S&T, Romsys and Frontal Communication.
The local software and IT services market is estimated to reach over EUR700 million 2011.
Roman, one of the most influential managers in the local IT industry, withdrew in May from the management team of IT services provider S&T to handle Kapsch operations.
The head of Kapsch Romania also said the Austrian company had reached almost 40 employees in Romania, and that their number could rise after the completion of the acquisition of a local company, which is in the process of due diligence.
“Some of our investments will be directed towards the acquisition of companies on the local market. In order to respond efficiently to the needs of our clients, these companies come from the area of technology and software services or companies that already have solid expertise in Kapsch’s main sectors of activity in Romania. Talks are in the process of due diligence with a local technology company,” said Roman, without providing more details.
(English version by Daniela Stoican)