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1. Immediate Alert
Computer software
16:30 BST 05 Oct 2018
ScaleFocus in talks with target, more acquisitions in the pipeline – CEO
ScaleFocus, a Bulgarian technology software development company, is in negotiations to
acquire a technology company that specialises in machine learning and analytics, CEO and
Founder Plamen Tsekov said. The target company has a size of 30-40 employees and the
deal is expected to be completed in 2018 or early 2019, he added.
Once this acquisition completes, the company will consider making further acquisitions after
its recent acquisition of Upnetix, he added. Upnetix is a development agency focused on
mobile engineering, front-end development and design driven digital transformation.
“We are looking to do one or two small acquisitions each year over the next four years,” he
added. ScaleFocus is targeting companies with a combination of technical skills in machine
learning, analytics, automation and customer facing in Europe and North America.
In the past, ScaleFocus has consistently delivered y-o-y growth of above 30%. This year, it
grew by 40% through pure organic growth, he said.
With zero debt and a positive cash position, the financing of potential acquisition will be
coming “from the shareholders’ pockets or bank loan financing from UniCredit”, Tsekov
said.
The company is expecting to achieve EBITDA of above EUR 3m for FY18, with the strategic
goal to triple the profitability to about EUR 10m by 2022 through a combination of organic
growth and acquisitions.
According to a report in June by this news service, the company was looking for a strategic
investor that would help it scale up.
ScaleFocus has been having “very early conversations” with private equity and venture
capital funds, Plamen said, but the company will pay more attention to this in 2019.
ScaleFocus joined Elite this year, a London Stock Exchange’s programme that assists
companies in developing their expansion strategy.
The privately-held company has nine shareholders, with 94% owned by four shareholders.
ScaleFocus’ main revenue stream comes from Western Europe and North America and has
more than 630 employees as of 1st October 2018.
UniCredit provides corporate banking service and short-term financings to ScaleFocus.
by Joshua Ip in London

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Target: Upnetix
Bidder: ScaleFocus AD
Debt Provider: UniCredit Group [Unicredito [still known as]]
Other: Upnetix
Source: Proprietary Intelligence
Size: < 30m (GBP)
Value: 3m GBP (FY18 EBITDA)
Stake Value: more than 30% inclusive
Grade: Strong evidence
Alert: MM EMEA Alert
Intelligence ID: 2715910
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