RIB Software has announced the US$31.5m acquisition of a 70% shareholding in South Africa’s CCS, a cost estimation and project control software provider.
The international expansion of Stuttgart, Germany-based RIB Software continues. The construction cloud technology provider has today (2 July 2019) has announced its acquisition of a 70% shareholding in South Africa’s CCS, a provider of cost estimation and project control software. The deal value is given as US$31.5m, based on an 8.5 EBIT/DA multiple.
Less than a month ago (7 June 2019), RIB invested US$42m to acquire 60% of USA-based BSD (Building Systems Design), to strengthen its estimating and product data technologies, and get a bridgehead in north America. This deal has a similar rationale on a different continent.
CCS and its products
With group headquarters in Johannesburg and Cape Town, CCS was founded in 1982 and is generating US$13.6m in annual recurring revenues (2019 revenues are forecast to be over US$18m), with an EBIT/DA margin of around 30% in a high potential and fast-growing market. Fifty per cent of the 160-strong company’s revenue comes out of the African market, and around 30% out of the Middle East. Other important markets include the UK, Portugal, India, Australia and New Zealand; in total it has around 40,000 users in 50 countries.
CCS’s cost estimation and project control software, Candy, is Africa’s leading application of its kind. CCS’s BuildSmart is a complete construction cost management and enterprise accounting/ERP solution (similar to RIB’s iTWO 4.0 concept) for the African, Middle East and other select markets. RIB believes that the 40,000+ CCS user community can readily be converted onto the MTWO Cloud, and also plans to develop its managed service provider business in Africa. RIB has also entered into a partnership with CCS’s African parent, the EOH Group, and has an option to buy the remaining 30% stake in December 2022.
RIB Group CEO Tom Wolf says:
“The investment in CCS can be seen as one of the most important milestones in the globalization process of RIB Software SE and to defend the global market leadership for our iTWO 4.0 and MTWO platform technology. RIB’s target is to be the international market leader for BIM digital transformation in the building and infrastructure (AEC) vertical in America, Asia, Europe, Africa and Australia.”
CEO of CCS Andrew Scudder says:
“We are very proud to be partnering with an industry leader like RIB, which will bring a wealth of opportunity to CCS, our clients and our team. We are particularly excited by RIB’s ambitious growth strategy and leadership in building the first construction industry cloud platform, that we believe will provide significant value to our clients. The investment by RIB in CCS affirms our leading market position as a provider of cost and enterprise management solutions to the construction & engineering industry. We look forward to the exciting journey of “Running Together” with RIB, as we continue to develop and scale CCS.”