Accenture buys Irish IT consultancy in latest acquisition drive

Global technology and consulting firm Accenture has agreed to purchase Irish consultancy Enterprise System Partners. The deal further strengthens Accenture Industry X.0, on the back of two other deals for the manufacturing-centred arm of the firm.

The Irish consulting market is worth just under €700 million, and has seen strong growth in recent years, as businesses look to insulate themselves from Brexit headwinds. With Ireland’s largest trading partner and closest neighbour in a weakened condition, digital technology is increasingly seen as vital for companies looking to not only survive but thrive in these adverse conditions. As a result of this, IT consultancies in particular have suddenly discovered that they are considered hot property in the country.

In March 2019, this saw Meritsoft, a Dublin-based specialist financial services software company, acquired by Nasdaq-listed IT services group Cognizant for an undisclosed sum. The move came as another part of Cognizant’s continued shift toward focusing on cloud computing, cyber security and analytics. Cognizant is aggressively pursuing new acquisitions, as it is competing with companies more than willing to supplement organic growth with new purchases. These include the major Indian IT companies such as Tata Consultancy Services, Wipro and Infosys, as well as Dublin-listed Accenture.

It is no exaggeration to state that Accenture has been spending big over the past few years. In 2017, the consulting and technology giant announced plans to spend a huge $1.8 billion on acquisitions to strengthen its global outfit – significantly more than what its biggest rivals have spent in the past years combined. In both years prior to that, the global consultancy spent more than $900 million buying companies, driven by an upsurge in demand from Fortune 1000 clients for digital and IT solutions.

2019 looks set to continue the trend, with Accenture having already splurged roughly $515 million on acquisitions in fiscal year 2019. According to Interim CEO David Rowland, the firm expects to spend $1.5 billion overall on deals, an estimate revealed during the consulting company’s Q2 fiscal 2019 earnings call. The deals align with “The New” – an Accenture strategy that pushes the company deeper into digital, cloud and security services.

With an eye toward those markets, the company has acquired 15 businesses for a combined $515 million in the first half of fiscal 2019 (about $34 million per deal, on average). This includes seven acquisitions in Accenture Interactive; three in Industry X.O; and four in Technology – including an emphasis on SAP and Oracle platforms. It is worth noting that this leaves Accenture with roughly $1 billion of its war chest to play with.

Rowland remarked of the deals, “If you look at Technology, three of those were directly tied to deepening our skills and the platforms. So I think there were a couple in Oracle and one SAP, as an example. There was another one around data and analytics. And then we had several vertical specific acquisitions, several in financial services, as an example.”

Enterprise System Partners

Accenture’s latest purchase is Enterprise System Partners (ESP). Founded in 2003, ESP boasts 200 professionals with manufacturing, process, and IT knowledge. The firm, based in Cork, Ireland, will join the Accenture Industry X.0 team in a move aimed at bolstering its manufacturing capabilities for pharmaceutical, biotech, and medical device clients globally.

ESP is a key purchase for Accenture, as it brings niche expertise in manufacturing execution systems (MES) and serialisation. MES is used to digitally track and document the production process, providing the groundwork for more automated and analytics-driven manufacturing and supply chains. Serialisation allows life science companies to digitally track each saleable unit from the packaging line all the way to the patient. It is the latest of several deals Accenture has made to expand its Industry X.0 wing in Europe and North America, having acquired Mindtribe and Pillar Technology in August 2018 to help with the growth.

Ben Salama, a Managing Director who leads Accenture Industry X.0 in the United Kingdom & Ireland, said, “Digital technologies are fundamentally transforming the factory floor. With ESP’s manufacturing solutions and our Industry X.0 capabilities, we can help clients take advantage of engineering and product life cycle management, advanced analytics, and artificial intelligence for a flexible, efficient, and cost-effective production process.”