59/60, quai Alphonse le Gallo
92513 Boulogne Billancourt Cedex
Telephone: ( + 33) 1 41 22 41 22
Fax: ( + 33)14122 4100
Web site: http://www.transidel.fr
Sales: EUR 505 million ($404 million)(2001)
Stock Exchanges: Euronext Paris
Ticker Symbol: TRA
NAIC: 541510 Computer Systems Design and Related Services; 541511 Custom Computer Programming Services
Transiciel SA in one of France’s fastest-growing information technology consulting groups, claiming the number three position in that country’s high-technology consulting sector behind Altran Technology and Alten SA. Transiciel’s performance, boasting an average annual growth rate of more than 50 percent since its founding in 1990, was recognized in 2001 with the prestigious “Trophy of the Decade” given by French financial magazine L’Expansion. Transiciel operates in three distinct areas: Systems Integration, which generates nearly half of the company’s annual sales of EUR 500 million; Facilities Management, generating one-third of sales; and Software Consulting, including development of in-house software sales and production scheduling solutions as well as support for third-party applications. Transiciel attributes much of its success and its business model: that of a network of more than 100 agencies operating independently and organized according to their geographic location, operational sector, or industry focus (and often a combination of these factors). The company features a number of large corporate clients such as Eurotunnel, Renault, France Telecom, Bouygues Telecom, Rhodia, Dassault, and Tenneco. While continuing to build on its presence in France, Transiciel has targeted international growth—the company expects to double its annual sales by 2004 while at the same time reducing the weight of domestic sales from 80 percent in 2001 to just 30 percent. The company has targeted Spain and the Benelux markets for its initial international growth, with acquisition including the Netherlands’ UCC at the end of 2001 and Belgium’s Ariane at the beginning of 2002. From these markets, the company expects to pursue a Europe-wide expansion in order to serve its larger, globally operating clients. Transiciel is led by founder and chairman Georges Cohen and has traded on the Euronext Paris stock exchange since 1998.
Best French Company of the 1990s
Georges Cohen, the force behind Transiciel, already had more than 16 years of experience as an information technology (IT) consultant before forming what was to become one of France’s fastest-growing IT consultant firms. In 1974, at the age of 19 and with no diploma, Cohen had been hired by Cap Gemini Sogeti as a technician. That company, founded as Sogeti in the mid-1960s by Serge Kampf when he was 33 years old, was itself in the process of formation after a bitterly fought hostile takeover of CAP by Sogeti earlier in the year, which itself was followed by the acquisition of Gemini Computer Systems. Sogeti had already distinguished itself by its willingness to move close to its customers, establishing a network of locally focused and largely autonomous agencies throughout France, before beginning a steady international expansion. Already France’s largest IT consultants at the time of the Cap and Gemini acquisitions, with sales of more than FFr225 million in 1974, Cap Gemini Sogeti’s expansion program of internal growth and targeted acquisitions helped it pass the FFrl billion mark at the beginning of the 1980s. Another important feature of the company’s growth was its insistence on targeting the nascent software market rather than attempt to gain a foothold on the hardware side. By the end of the 1980s, Cap Gemini Sogeti had become one of the world’s top five IT consultants.
Meanwhile, Georges Cohen become part of Cap Gemini’s success story, stepping up from the technical department to become one of the group’s best salesmen. Cohen’s drive quickly caught the attention of Serge Kampf, who boosted Cohen into the company’s top management—Cohen was to be the youngest member of Cap Gemini’s management team and later became considered as Kampf’s right-hand man. Yet, as Cap Gemini’s sales topped FFr9 billion at the beginning of the 1990s, Cohen was preparing to strike out on his own.
Cohen had long nourished the ambition to start up his own company during his years at Kampf’s side. In 1990, Cohen, then 36 years old, decided it was time to try, reportedly telling Kampf, who tried to convince Cohen to remain with Cap Gemini: “You started your business at 33 years, I’m three years late.” Cohen took his FFr3 million in savings, and, with his wife serving as the firm’s accountant, started up his own business in 1990. Cohen called his company Transiciel, a contraction of the French words for “transforming” and “software,” to highlight the company’s targeted market.
Cohen made no secret of his ambition—becoming rich—and, using the lessons gained from his career at Cap Gemini, set about building Transiciel. Rather than take on the broad IT consultants market, the company quickly defined its core market, targeting at first the newly developing systems management sector as the computer industry made the transition to open client/server systems. Transiciel began by providing total information systems infrastructure engineering, management, and administration services. Despite the awkward timing—Transiciel was created during a worldwide IT industry slump that was soon exacerbated by a general recession and the effects of the Persian Gulf War—Cohen quickly proved an able student of Kampf.
Cohen’s background in sales served the company well. Before the end of its first year, Transiciel had already gained a strong client list and had built up a workforce of more than 100. As a new company, Transiciel was able to turn directly to the deployment of open client/server systems, leaving it free of its competitors’ baggage of supporting out-of-date legacy systems. The company was also in a position to target the market for major corporate accounts as larger companies began a growing trend for subcontracting their IT needs in the early 1990s. Transiciel quickly developed a second specialty, the integration of management systems, including consultancy services, client-specific software development, and software and systems integration services.
Cohen was joined by a number of former Cap Gemini colleagues in 1991, including Pierre Dalmaz, who would later become CEO of Transiciel. Once again, Cohen took a page from Cap Gemini’s book, building a strong, independent management team while he “managed the managers” and guided the company’s overall development. Not content merely with pursuing organic growth, Transiciel quickly began making acquisitions as well. In 1991, the company took its first external growth step, buying up competing group Excel. Two years later, the company made two more significant purchases—PBA and Axor. By the end of that year, Transiciel’s revenues had topped FFr 200 million (EUR 30 million).
A drop-off in growth in the mid-1990s—during a deep crisis affecting much of the IT industry—led the company to restructure its operations in 1995, leading to the adoption of a new business model that the company claimed made it unique among its competitors. Cohen now developed a more decentralized approach, reorganizing the company’s operations into a network of branch offices, each staffed by 40 to 100 employees in order to maintain a’human scale” for each branch. These branch offices were created according to various criteria—activity, geography, industry (or a combination of one or more of these)—with an emphasis placed on sales and marketing efforts. Each of the branch offices was then given a great deal of autonomy, yet at the same time they were all carefully monitored by means of a sophisticated data tracking system. Transiciel also gave its employees the opportunity to acquire shares in the company—a move which was to provide a strong incentive to its workforce.
By the 1996, the reorganization was already proving to be a success, as the company’s sales topped EUR 56 million, while profits reached EUR 1.7 million. Transiciel was to post average annual growth rates of 50 percent and more through the second half of the decade, compared to an industry average of 16 percent, a record which was to earn it an award in 2001 as the best new company of the decade. Transiciel now began the march toward achieving critical mass, matching its organic growth with a new series of acquisitions.
Building Toward the EUR 1 Billion Mark in the 21st Century
The first of Transiciel’s new acquisitions came in 1997, when the company purchased two French companies, Odos and Sigle Informatique. These were followed up in 1998 with the acquisitions of Diaf, Progitec, and Vitamines. The acquisitions had left Georges Cohen—who made no secret of his fondness for gambling—personally in debt for more than EUR 150 million. Yet Cohen took the risk nonetheless, as he prepared his company for a public offering.
The Success Angels: Since Information control is the key to success, and since you cannot control Information alone, the TRANSICIEL Success Angels are there to help you. With their support, you will fly from success to success. There are 7000 of them. They are computer experts and cover all the requirements of the information systems operated by the major groups. They are recognized specialists, experienced in new technologies. They propose the technologies, the software, and the architectures to provide a solution that meets the requirements of the big accounts. With nearly 120 agencies, these Success Angels, aware of the stakes in your business, offer you a proximity service. To optimize their support, they are specialized by business activity. The Group’s growth, one of the highest in the sector, is backed up by a sustained recruitment strategy. TRANSICIEL has a strong human relations policy, which ensures that staff are motivated and new talent attracted. With 1,500 people at the beginning of 1998, TRANSICIEL now has more than 9,000 employees.
Transiciel went public in March 1998, initially taking a listing on the Paris Stock Exchange’s secondary market. By February 1999, Transiciel had already been promoted to the IT CAC 50 board of leading technology stocks, and at the end of 1999 the company transferred to the Paris main board on the Monthly Settlements Market before joining the Deferred Settlements Market in 2000. The company’s sales were evolving strongly as well, topping EUR 88 million in 1997, jumping to EUR 153 million in 1998, then nearing EUR 255 million in 1999.
The public offering enabled the company to step up its expansion as well as move into new territories. As Transiciel continued to impose itself on the French market—pushing its way into that country’s IT consultants market top ten—Transiciel also began preparing to grow internationally. The company’s international expansion came as much as a result of recognizing that it needed to follow the international growth of its major clients. Transiciel immediately targeted two markets—Spain and the Benelux countries—and began its expansion through a number of new acquisitions.
In Spain, the company acquired Seinto and Sysdata in 1999, then boosted its position into that country’s top ten IT services and engineering companies with the acquisitions of Sysma and especially of Madrid-based Level Data in 2000. The acquisition of Bee Way in 2000 enabled the company to consolidate its systems management operation, adding a staff of 400 and annual sales of nearly EUR 40 million in the process. At the same time, Transiciel began its moves into the Benelux markets—seen as a key entry point into the larger northern European market—by acquiring IT-Software Belgium and IT-Software Luxembourg.
While pursuing its international growth, Transiciel was also diversifying into new market areas, adding e-business and net economy components as it entered a new market sector, high-technology consulting, a move achieved with the acquisition of French group CR2A-DI. Transiciel quickly moved to consolidate its position in the high-technology sector, acquiring French company Sinfor. With these acquisitions, Transiciel asserted itself quickly in the French market, capturing the number three position in the high-technology segment, behind Altran Technology and Alten, by 2001. Transiciel continued to build up that area, acquiring Gencom, a company specializing in the fields of telecommunications and digital television, and Retec Group, which focused on the research and development field.
Transiciel’s sales continued to build, growing to EUR 377 million in 2000. Contributing to that increase was another important acquisition, that of the Netherlands’ UCC (Universe Computer Consultants), for which Transiciel paid EUR 62 million. The company deepened its holdings in the Benelux markets with a takeover offer in 2000 for Belgium’s Ariane; by the beginning of 2002, it had succeeded in acquiring 96 percent of that company. The addition of this company helped boost Transiciel’s payroll to more than 9,000. By then, too, Transiciel’s revenues had topped the EUR 500 million mark, while Georges Cohen had already defined a new goal—doubling the company’s sales to top the EUR 1 billion mark by 2004. Yet Cohen, who continued to hold more than two-thirds of the company’s stock, with a majority of its voting rights, had already succeeded in his original goal—making himself and his co-workers rich.
Transiciel Ingenerie; Transiciel Regions; Transiciel I.S.R.; Transiciel CISA; Transiciel International Ltd.; Transiciel Benelux; CR2A Holding; Sinfor Holding; Has.net.
Altran Technology SA; Alten SA.
- Georges Cohen sets up his own IT business under the name Transiciel.
- Transiciel acquires French company Excel.
- Transiciel restructures its operations.
- The company acquires Odos and Sigle Informatique to build its position in French IT sector.
- Transiciel goes public on the Paris stock exchange.
- The company acquires CR2A-DI to move into the high-technology consulting sector and begins international expansion with the acquisition of Spain’s Seinto and Sysdata.
- Transiciel enters the Benelux market with the purchase of IT-Software Belgium and IT-Software Luxembourg.
- Ariane in Belgium is acquired.
Emmanuel, William, “Transiciel Studying Acquisitions,” Reuters, March 6, 2000.
Sanders, Rik, “Interview with Pierre Dalmaz,” Computable, December 21, 2001, p. 13.
“Transiciel a nouveau bien oriente,” La Tribune, March 20, 2002.
“Transiciel, formate pour un marche en explosion,” U Expansion, March 5, 1998.
“Transiciel, le succes au culot,” L’Expansion, October 25, 2001.