By Kelly Teal, Editor-in-Chief, AOTMP Research Practice
TEM provider Calero continues to beef up its market share in Europe with the acquisition of another provider there, Veropath Ltd. (formerly IntelligentComms) out of Scotland.
Europe has turned into a hot opportunity for telecom, mobility and technology management and Calero is aiming to get ahead of its competitors by targeting smaller, nimble vendors that have proven their mettle. In January, Calero bought Netherlands-based A&B Groep. That deal immediately expanded Calero’s reach in mobility and mobile optimizations, where A&B boasts extensive local expertise. Now, with Veropath, Calero gains even more footprint and capabilities, including more languages. Veropath supports 30 countries.
“This transaction is one of a few carefully chosen strategic acquisitions.”
–Calero’s Steven F. Kaplan
“The addition of Veropath more than doubles Calero’s European team, further strengthening our market position within the EMEA region,” Chris Jurasek, president and CEO of Calero, told AOTMP.
Steven F. Kaplan, chairman of Calero and general partner at Riverside Partners, which owns Calero, agreed. “This transaction is one of a few carefully chosen strategic acquisitions designed to add scale, enhance client service and broaden Calero’s technology and service offerings while carefully maintaining a one-company global approach,” he said.
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Calero’s Europe-focused strategy is proving incisive. To that point, AOTMP Research in a recent report, What to Expect from TEM/EMM Services: 2018-2020, noted that Europe represents possibly the fastest-growing region in the world. More enterprises are expanding within the continent and facing challenges from stringent privacy and compliance regulations to the need for deep, proactive management of data handling and end-user mobile policy.
Veropath is a relatively small company, with £279 million, or approximately $363 million, in spend under management. That indicates book of business didn’t play a huge rule in Calero’s decision to buy Veropath; rather, the impetus likely has bigger-picture context. “Knowledge and experience is likely the main benefit gained,” said Timothy C. Colwell, executive vice president at AOTMP. “It’s a smart move on Calero’s part to acquire knowledge and experience in EMEA.”
One aspect that factored into, but did not fuel, the acquisition was Veropath’s compliance with the European Union’s General Data Protection Regulation (GDPR) framework that enforces how peoples’ information is collected and processed. Calero already handled compliance issues on this level because of its international customer base; adding Veropath – and A&B Groep earlier this year – bolsters that competency.
Another core strength for Veropath is its call marking/masking capabilities that identify personal versus corporate use. This helps enterprises to define their cost structures and ensure compliance – again, another tie to GDPR and a significant selling point in the expense management sector.
Of course, Calero will need to remain mindful of the challenges of integrating new companies. One key area, as always, comes down to the management of multiple platforms. “It will be interesting to see if Veropath customers will ultimately migrate to the Calero software platform,” said Scott Lawrence, vice president and senior research analyst at AOTMP.
On the whole, AOTMP sees Calero’s purchase of Veropath as savvy and timely. Calero now boasts more people, technology and experience to cover more ground in a rapidly expanding and competitive market. “This deal strengthens Calero’s European compliance and growth models,” said Andrew Hartwyk, senior research director at AOTMP Research. “So while Veropath is not a large customer acquisition, it does add more Europe-based operational and sales expertise to complement the earlier acquisition of A&B Groep.”