The recent weeks saw several M&A deals on the thriving Ukrainian IT service scene, driving some market consolidation.
Thus InSoft Software, a company launched earlier this year by Ukrainian investment firms InSoft Partners and UFuture, increased its stake in Rozdoum (Kharkiv) and bought a controlling stake in Rademade (Kyiv).
As reported by local tech blog AIN.UA, the two companies are already in the process of merging with a third one, Lenal.eu, of which InSoft also owns a majority stake. AIN.UA estimated the value of the three assets at some $1.5 million. The new holding will operate under the name of ITernal Group, targeting clients from Western countries.
Almost simultaneously Beetroot, a Swedish IT company with offices in five Ukrainian cities, acquired two other companies: Ukrainian Onlinico and Swedish Aducera. The details of these transactions were not disclosed.
Onlinico develops software solutions for the US and European markets. Since 2017, the company has been collaborating with Beetroot Academy, a major non-profit IT education program across Ukraine.
“This integration [with Onlinico] will help us strengthen our ecosystem and boost up the delivery of complex projects for our clients,” says Andreas Flodström, co-founder and CEO of Beetroot and Beetroot Academy.”
A large fraction of the Ukrainian market is made of small players who need to reach a critical mass to access large international contracts.