Together. Free your energies
C i i i t l f CPM B i d t l Capgemini acquires control of CPM Braxis and strongly accelerates its expansion in fast growing economies
2nd of September 2010
A significant step in the implementation f C i i’ G th St tof Capgemini’s Growth Strategy
Acceleration of external growth in Fast Growing Economies 1Brazil is the most mature IT services market among the BRICs and the largest in Latin America.Gartner foresees >10% growth until 2014 for the IT services market in Brazil. Acquisition will enhance our existing Latin America presence from 2,600 to 8,100 employees.
CPM Braxis is the largest Brazilian IT services CompanyEstimated revenue of 1 B$R in 2010 (450 M€), with strong FS and Telco sector presence.
2
A very strong 18% revenue CAGR and 25% bookings CAGR from 2008 to 2010.Full IT services provider : Applications (SI & OS), Infrastructure (Consulting, OS, HW / SW reseller).A very solid management team with experience in global IT companies
Capgemini acquires 55% of CPM Braxis for 517 M$R (233 M€)Acquisition settled in two parts, a capital increase and a purchase of shares.All current shareholders including Bradesco, the largest shareholder, will maintain ownership in the
3
g g pcompany and have been proportionally reduced through the transaction.
Brazil will now be the 6th largest country in the Group by headcount
Together. Free your energies2© 2010 Capgemini. All rights reserved.
Brazil will now be the 6th largest country in the Group by headcount
Capgemini’s journey towards globalization i b d th j illis based on three majors pillars
1st Step : organic growth in China, India and Brazil
2nd Step : Acceleration with acquisition
Brazil as a first priority : 11th IT Services market with
double digit growth
Fast Growing Economies
Started2 years ago
double digit growth
Shared client ownership
Full responsibility
Transversal expertise
Most competitive pricing
900020000 25300 28000
40 000
2006 2007 2008 2009 2010
OffshoreEmpowered
modelStarted
6 years ago
10 years experience
Most competitive pricingOffshore headcount
19% of 2009 revenue
8,379 headcount
25% of revenue with Fortune 100 accounts
USStarted10 years ago
Together. Free your energies Insert "Title, Author, Date"3© 2010 Capgemini. All rights reserved.
The Brazilian IT services market is th t tt ti th f t i t i
Latin America IT Service Market Growth
the most attractive among the fast growing countriesIT professional services market (2009)
12
($USD billions)
34 940
p ( )($USD billions)
8
10
16,723,525,8
28,631,6
34,9
25
30
35
10,14
6 11,0
12,213,6
15,1,
15
20
25
5,74,2
2,32 12,5 13,6 15,0 16,5 18,2
5
10
-Brazil China India Russia
-2010 2011 2012 2013 2014
Rest of Latin America BrazilSource: 2010 Gartner Latin America IT Services Market GrowthSource: Gartner Forecast: IT Services, Worldwide, 2000-2014, 2Q10 update
Together. Free your energies4© 2010 Capgemini. All rights reserved.
CPM Braxis is the Largest Brazilian IT Services company
CPM Braxis shareholders partnering with C i i t f l d l tCapgemini guarantees successful development
Post Transaction Shareholder Str ct rePre Transaction Shareholder Structure Post-Transaction Shareholder StructurePre-Transaction Shareholder Structure
Private Emplo Private
30.5%45.4%
3.3%20.8%
Equity Emplo-yees
11.9%10.5%20.3%
Private Equity
2.3%
Emplo-yees55.0%
Together. Free your energies Insert "Title, Author, Date"5© 2010 Capgemini. All rights reserved.
CPM Braxis has 60% recurring revenues and t t h l d th & b dth f i strong technology depth & breadth of services
AO ITS
Applications OutsourcingApps Assessment & PlanningApps DevelopmentApps Management ServicesTesting ServicesCode Factory
Infrastructure ServicesInfrastructure Assessment & PlanningManaged ServicesNetworking SolutionsHardware as a Service SolutionServers SolutionsCode Factory Servers SolutionsData Center ServicesContact CenterInformation Security
% 2010 Revenues
25%36% 25%
11%28%
Infrastructure IntegrationHW/SW R lli B i Enterprise Application Services
EASII
5,500 employeesHW/SW Reselling BusinessNetworking IntegrationServers & Storage SolutionsVirtualization SolutionsData Center Solutions
Enterprise Application ServicesERP, CRM, BI Projects BPM-ECMMaintenance & SupportHelp Desk
Together. Free your energies6© 2010 Capgemini. All rights reserved.
CPM Braxis has a solid local presencei B il d 200 li t bin Brazil and +200 client base
Roralma
Amapa
AmazonaPara
Maranhao
Piaui
CearaRio GtrandeDo Norte
Paraiba
PernambucoAlagoasTocantins
Acreg
SergipeBahiaTocantins
Mato Grosso
Brasilia (DF)
Goias
Rondonia
Technical Presence
Group Headquarters(Sao Paulo – 3,850, 68%)
Revenues by sector Development Centers• Alphaville, SP• Belo Horizonte, MG (275)• Brasília, DF (210)
Minas GeraisEspirito Santo
Rio de Janeiro
Santa Catarina
Parana
Mato GrossoDo Sul
Sao Paulo
Financial Services (58%)Telecom (20%)
Commercial PresenceTechnical Presence
( )• Florianópolis, SC• Rio de Janeiro, RJ (720, 13%)• Salvador, BA (338)• São Paulo, SP• Volta Redonda, RJ
Santa Catarina
Rio GrandeDo Sul
( )
Together. Free your energies7© 2010 Capgemini. All rights reserved.
Note: CPM Braxis has small numbers of employees (~1 or 2 FTEs) in 91 locations throughout Brazil to provide infrastructure field services support.
CPM Braxis performs above the marketCPM Braxis performs above the market
2008 - 2010
970
Bookings ($R millions) Revenues ($R millions)
1 655
729
970
1,394
1,655817
18%
1,009
38%
19%12%
2008 2009 2010Application Services EAS
2008 2009 2010(Estimate)
(Estimate)
Together. Free your energies
Infra Services Infra Integration
© 2010 Capgemini. All rights reserved. 8
A very talented and experienced management team
Executives Biography Executives Biography
experienced management team
Jair Ribeiro, Chairman, Executive Committee David Shpilberg, Vice Chairman, ExecutiveJair Ribeiro, Chairman, Executive CommitteeFormer CEO & Co-Founder, BraxisFormer CEO & Co-Founder, Banco PatrimonioFormer CEO, Chase Manhattan (Brazil)Former MD, JP Morgan
David Shpilberg, Vice Chairman, Executive CommitteeFormer Partner, Bain & Co. – Head of Global IT Strategy PracticeFormer Vice-Chairman, Ernst & Young – Global Head of IT ConsultingFormer CIO, Goldman Sachs Equities & Asset Mgt.
José Luiz Rossi, CEOFormer GM IBM GBS, Southwest EuropeFormer head IBM GBS, LatAmFormer head, PricewaterhouseCoopers, LatAm
Rogerio Brecha, COOFormer CEO of Ernst & Young Consulting BrazilFormer Managing Partner of Deloitte Consulting BrazilFormer VP and GM of Unisys Latin America
, q g
Founder, Result Systems
André Mesquita, CFOFormer VP Cotia Trading Argentina
Former VP and GM of Unisys Latin America
Paulo Marcelo, VP of Sales BrazilFormer Head of Industry Cluster at CPM Braxis
Former COO/CFO SertradingCofounder and former partner of Unitech TecnologiaFormer CIO of Braskem, OAS and Vega Ambiental
Veronika Falconer, Head of Human ResourcesFormer Latin America HR Lead in Accenture Over 14 years experience in Human Resources11 years of industry experience
Together. Free your energies© 2010 Capgemini. All rights reserved. 9
Bradesco remains a key shareholder & client Bradesco remains a key shareholder & client Founded in 1943 15th largest bank in the world (Forbes Global
Bradesco’s stake in CPM Braxis will change from 45.4% 15th largest bank in the world (Forbes Global
2000)One of the largest private banks in Latin AmericaMarket Capitalization of $R100bn3rd largest bank by assets in Brazil
gto 20.3% as a result of the transaction, but it will still remain the largest Brazilian shareholder.
3rd largest bank by assets in BrazilOver 85,000 employees with offices in 5,564 Brazilian municipalities
Bank Assets (bns)
Ranking by Assets (2010) IT Services Provided to Bradesco by CPM Braxis
Applications Outsourcing
Applications Development
1 Banco do Brasil (P) $R725
2 Itaú Unibanco $R635
3 Banco Bradesco $R533p
Professional Services
InfrastructureServices
4 Caixa Econômica (P) $R364
5 Santander $R342
Fonte: Valor Econômico 14/05/2010(P) St t d O d
Together. Free your energies10© 2010 Capgemini. All rights reserved.
(P) Stated Owned
CPM Braxis Financial EstimatesCPM Braxis Financial Estimates
FY 2010EEstimates ($R millions) FY 2010EEstimates ($R millions)
Revenue 970Adjusted EBITDA 8%Adjusted EBIT 6%
Revenues will grow 15% - 20% in 2011.Margins will continue to improve in the medium term.Extraordinary labor contingency provision in 2010 will be 91 M$R. N f th i ifi t l b ti i i f dNo further significant labor contingencies going forward.
Together. Free your energies11© 2010 Capgemini. All rights reserved.
Capgemini acquires its 55% stake th h it l i d h b tthrough a capital increase and shares buyout
Deal Structure
Private
Shares Buyout230 M$R
Capital Increase
Private Equity Employees
Capital Increase287 M$R
• Total investment from Capgemini is 517 M$R for 55% stake in CPM Braxis based on a firm value of 970 M$R.• The acquisition is settled in two parts, a capital increase of 287 M$R and a 230 M$R purchase of shares.• From the 3rd to 5th years shareholders have call / put options to buy / sell remaining 45%.
C i i ill i b l h t li bilit ti th ti t d l f th 45%• Capgemini will recognize a balance sheet liability representing the estimated value of the 45%.
Together. Free your energies12© 2010 Capgemini. All rights reserved.
Acquisition Completed at 1x 2010 E ti t d R2010 Estimated Revenue
FV/ Revenues 2010
LatAm IT & BPO Offshore IT ServicesIndian IT Services
3,8x
5,6x4,7x
3,1x 3,5x2 2x 2,7x4,0
6,0
8,0
LatAm IT & BPO Offshore IT Services2010E Median: 1.6x
Indian IT Services2010E Median: 4.7x 2010E Median: 2.2x
1,7x 1,5x0,7x
2,2x ,1,6x
1,2x 1,0x
0,0
2,0
FV/ EBIT 2010
19,2x
13,4x 12,0x7,6x
19,2x16,8x 15,8x
18,7x14,1x
11,6x16,1x
57.7x
16,7x
10,0
20,0
2010E Median: 12.7x 2010E Median: 16.8x 2010E Median: 16.1x
0,0CPM
BraxisWNSEXLSyntelGen-
pactCogni-
zantWiproTCSInfosysContaxSondaTivitTotvs
Source: CapitalIQ August 31, 2010 Market Figures
Transaction multiples calculated on a FV of 970 M$R
Together. Free your energies13© 2010 Capgemini. All rights reserved.
We aim to over perform the marketth h th i ithrough three main synergies
1
Capgemini will fully support its CMA accounts in Brazil through CPM Braxis. Approximately 50% of Capgemini’s CMA accounts have operations in Brazil today generating more than € 5 billion
2
CPM Braxis can immediately begin to leverage Capgemini’s alliances and partnerships in their own service offerings
Capgemini will help accelerate the sales of CPM Braxis’s Remote Infrastructure
3
pg pManagement (RIM) services in North America, which they have already begun to grow on their own.
Together. Free your energies© 2010 Capgemini. All rights reserved. 14
Capgemini in LATAM Today and TomorrowCapgemini in LATAM Today and TomorrowCapgemini México (IT services)
Since 2000, former E&Y branch230 employees
Mexico
GuatemalaSalvador
CubaRep. Dominican
Jamaica
p y
LATAM Operating Highlights
Ecuador
Colombia
Venezuela GuyanaSalvador
Costa Rica Capgemini B.S. Brazil (BPO)Since 2008, Unilever acq.598 employeesCapgemini Guatemala (BPO)
Since 2008, Transactel acq.485 employees
Provide local IT services in Brazil, Argentina and MexicoProvide offshore BPO & IT services from Guatemala, Chile, A ti d B il
Peru
Bolivia
Paraguay
BrazilArgentina and Brazil€55 million in total LATAM 2009 revenues (50/50 IT & BPO) – 73% YoY growth from 20082,608 employees across 5 countries
CPM Braxis5,500 employees.
UruguayArgentina
Chile
Capgemini Brazil (IT services)NCG partnership / acquisition121 employees
, p yin LATAM growing to 8,108 employees after the acquisition of CPM Braxis
Capgemini Argentina (IT services)NCG partnership / acquisitionSince 2008 Offshore delivery centre: as of today 650 employees.
Capgemini B.S. Chile (BPO)Since 2008, Unilever acq. 524 employees
Together. Free your energies15© 2010 Capgemini. All rights reserved.
Capgemini Expands Global FootprintCapgemini Expands Global FootprintLocal Developed Markets: 61,360 (59%)Delivery Centers: 33,376 (32%)Local Fast Growing Markets: 8,464 (8%)
TOTAL GROUP 103,200
North America: 8,088USA (Local): 6,832Canada (Local): 1,256
Europe: 56,916France (Local): 19,594Benelux (Local): 10,906UK 8 294
g , ( )
UK (Local): 8,294Iberia (Local): 4,823Eastern Europe (Delivery): 3,762Eastern Europe (Local): 643Nordic (Local): 3,792Central Europe (L l): 3 496Central Europe (Local): 3,496Italy (Local): 1,544Ireland (Local): 63
Central America: 715Guatemala (Delivery): 485Mexico (Local): 230
Asia Pacific: 29,825India (Delivery): 26,287India (Local): 994PRC (Delivery): 753PRC (Local): 723
Mexico (Local): 230
Australia (local): 625Philippines (Delivery): 171Vietnam (Delivery): 137Singapore (Local): 93Hong Kong (Local): 42
South America: 7,393CPM Braxis Brazil (Local): 5,500Capgemini Brazil (Delivery): 598Capgemini Brazil (Local): 121Argentina (Delivery) : 403A ti 247
Africa / Middle East: 262Morocco (Delivery): 256Middle East & Africa (Local): 6
Together. Free your energies16© 2010 Capgemini. All rights reserved.
Argentina (Local): 247Chile (Delivery): 524