Global consultancy giant Accenture has bought trans-Tasman SAP and cloud solutions technology firm Zag for a reported $45 million.
Accenture said the acquisition would bolster its New Zealand and Australian digital transformation capabilities to meet increased demand from organisations migrating to the cloud and SAP’s next generation products.
Zag has offices in Auckland, Wellington, Sydney and Melbourne with a team of over 200 professionals. The terms of the buyout were not disclosed, but the Australian Financial Review was reporting the sale price as $45 million
The company, which was founded in 1996 as Soltius, is a leading SAP specialist provider that offers services including consulting, development, support, testing and cloud migration.
Clients include the New Zealand farmer owned cooperative Ballance and Australian energy provider Hydro Tasmania.
“By pairing Accenture’s global expertise with Zag’s local talent and insight, this acquisition will strengthen our ability to help clients accelerate their business transformation using SAP and Cloud technologies delivering more value from the new platforms," said Ben Morgan, Accenture’s New Zealand managing director.
"This move demonstrates our ongoing commitment to bringing new thinking, talent and innovation to clients across the region."
Nick Mulcahy, CEO of Zag, said the firm had grown from an idea to a thriving business that has helped over 100 organisations to become "stronger, safer and more prosperous" through the best possible use of technology.
“Since 1996, Zag has led the SAP market in New Zealand through our drive to think creatively, the close relationships we build with our customers and our firm belief that our people are our strength," Mulcahy said.
"The combination of Accenture and Zag is a great opportunity for our clients and teams, and we look forward to offering an unrivalled SAP offering.”
Mulcahy or interests associated with him owns close to 30 per cent of Zag via a company called Soltians, according to NZ Companies Office records. He joined the then Soltius in 2003 as a senior consultant.
Scott Hahn, Accenture’s technology lead for Australia and New Zealand, said Zag’s experience in delivering cloud and SAP solutions for a wide range of complex businesses would be pivotal to the expansion of Accenture’s local technology offerings.
"Their extensive expertise and knowledge further deepen our networks and capabilities to meet the anticipated growth in demand for SAP and cloud services and we are delighted to welcome them to the team," he said.
Accenture’s Zag acquisition follows other investments across Australia and New Zealand in the past 18 months, including data analytics and supply chain management company Icon Integration in February 2020; business strategy and econometrics firm AlphaBeta in February 2020; specialist government consultancy, Apis Group in December 2019; big data and analytics company Analytics8 in August 2019; and cybersecurity and technology company BCT Solutions in June 2019.
Accenture recently announced the formation of Accenture Cloud First with a US$3 billion investment over three years to help clients across all industries rapidly become “cloud first” businesses and accelerate their digital transformation to realise greater value at speed and scale.
Article updated on 6 October to include the reported value of the acquisition.