Information on the Target

South Eastern Europe Fund L.P. (“SEEF”) has sold its 90.5% stake in Total Soft S.A. (“Total Soft”), a leading Romanian enterprise application software provider, to Logo Yazilim Sanayi ve Ticaret A.S. (“Logo”). The sale values the total equity of Total Soft at €30.25 million, representing an EBITDA multiple of 8.6x based on the company's 2015 EBITDA of €3.48 million.

Founded in 1994, Total Soft has developed its flagship product, the Charisma Business Suite, which caters to large and mid-sized enterprises across various sectors. Over the years, Total Soft has successfully expanded its market presence, establishing a robust client base in 35 countries worldwide.

Industry Overview in Romania

Romania's enterprise software industry is experiencing notable growth, driven by increasing digital transformation among businesses. This sector is characterized by a rising demand for innovative software solutions that enhance operational efficiency and support businesses in navigating complex market dynamics.

The introduction of cloud computing and other emerging technologies has further accelerated growth within this industry. Companies are seeking reliable partners for enterprise application solutions to streamline processes and improve decision-making capabilities.

Additionally, Romania benefits from a strong pool of IT talent, which enhances the competitiveness of local software firms. The availability of skilled professionals supports the development of cutting-edge software solutions tailored to meet the specific needs of various industries.

With an expanding tech-driven economy, Romania continues to be an attractive market for both local and international software companies looking to capture growth opportunities.

The Rationale Behind the Deal

The acquisition of Total Soft by Logo represents a strategic move to enhance Logo's international presence and competitive positioning in key sectors, including finance, leasing, and healthcare. By leveraging Total Soft's successful solutions and established market reputation, Logo anticipates significant synergy effects that will foster mutual growth.

Furthermore, Total Soft's proven track record and its innovative approach in developing applications position it well for future expansion in untapped markets, making it an appealing asset for Logo to advance its strategy.

Information About the Investor

Logo Yazilim A.S., founded in 1984, stands as the market leader in Turkey for enterprise software solutions aimed at small and mid-sized businesses. The company has a distinguished reputation as Turkey's largest independent software vendor (ISV) and is publicly listed on Borsa Istanbul since 2000.

In 2015, Logo reported sales of €42.7 million and net profits after tax amounting to €13.2 million, with a market capitalization exceeding €335 million. The firm is recognized for its extensive user base and commitment to delivering quality software solutions tailored to the specific needs of its varied clientele.

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This acquisition may represent a significant opportunity for Logo as it expands its footprint in the region. By integrating Total Soft's advanced offerings and leveraging its R&D capabilities, Logo can expect to enhance its product portfolio and drive further innovation.

Moreover, the move aligns with Logo's strategic ambitions of penetrating larger markets, including the Turkish market, where Total Soft's Charisma Business Suite can find substantial applications among larger enterprises.

Given the robust growth trajectory of the enterprise software industry in Romania and the valuable assets acquired through this deal, it is reasonable to consider this acquisition a sound investment that could yield favorable returns as both companies embark on ambitious expansion strategies.

Overall, the transaction appears promising, as both parties possess complementary strengths that could lead to enhanced competitiveness and sustained growth in an evolving market landscape.

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