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Deal 5: Ciklum GC Anna Ryzhova on Acquisition of CN Group

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On September 13, 2021, CEE Legal Matters reported that Dentons had advised Ciklum on its acquisition of Czech-based software development company CN Group from Genesis Capital. CEE In-House Matters spoke with Anna Ryzhova, General Counsel at Ciklum, to learn more about the acquisition.

CEEIHM: To start, tell us a bit about Ciklum

Anna: Ciklum is a global company that specializes in digital solutions and digital transformations. We’ve been in the industry for almost 20 years now and have won the trust of hundreds of corporate customers. Among our clients are well-known companies from the Fortune 500 and fast-growing organizations alike around the world.

We’re truly global – Ciklum has customers in the UK, Western Europe, namely Germany and Switzerland, the US, Israel, Nordics. We are happy to serve our global clients from our delivery centers in various regions – Ukraine, Poland, Spain, Czech Republic, Pakistan. We don’t stop there, and Ciklum is further expanding into new regions.

Having experience and expertise in various domains, Ciklum helps leading companies in several industries with implementing their digital strategies, like Metro in retail, Payoneer and eToro in FinTech, TUI in tourism, JustEat in food delivery, JLR in Automotive, and many more.

CEEIHM: As we recently reported, Dentons advised your company on its acquisition of Czech-based software development company CN Group. What was it about the target that you found particularly appealing?

Anna: I would say that initially, we looked for a business with the same mindset, striving to innovate and redefine industries with digital solutions. And that’s exactly what we saw in the CN Group with their long history of delivering innovation R&D. We saw that the CN Group team would be a perfect addition to more than 3,600 Ciklum talents and can enrich us with their expertise in bespoke software development, quality assurance, added value IT consulting, and mechanical design engineering.

Additionally, the strong position of the CN Group in Central Europe and Nordics offers Ciklum a splendid opportunity to expand our presence in the CEE and DACH markets. Another factor that made the CN Group an interesting target for us was its delivery centers with qualified engineers in Czechia, Slovakia, and Romania. Its flawless employer reputation and powerful corporate culture will help us pursue the common mission of advancing the digital evolution of businesses with scalable solutions.

CEEIHM: What were the most challenging aspects of the deal and how did you overcome them?

Anna: It should be noted that this M&A cycle was surprisingly fast for the IT industry. We managed to close the deal in less than four months – from the first contact untill the final transaction! I guess, partly it is due to our common Danish roots and its culture of transparent, open, and efficient communication that helped us avoid any potential road bumps. In addition, communication and meetings between stakeholders in different time zones were other challenges demanding some management choreography. Both Ciklum and the CN Group leadership aimed at a seamless process, striving to focus on the future goals and perspectives the deal opens.

Of course, any M&A deal is unique. Still, Ciklum enjoys powerful support from our investors, Recognize Partners, uniting top industry experts with dozens of years of experience. Their expertise and input were essential for this deal to be successful. We are looking forward to exploring the new possibilities the deal has brought and are eager to become even stronger as a digital solutions company.

CEEIHM: How did you split the legal work between your in-house legal team and that of Dentons?

Anna: In this deal, Dentons assisted us on the legal due diligence, merger control assessment, and preparation of transaction documents. The in-house team worked with Dentons on the transaction documents and focused on negotiating the deal with the seller and preparing for subsequent integration between the target and Ciklum, including onboarding the new management, service and trade-related issues, and post-closing filing and reporting.

CEEIHM: And why did you choose Dentons as your advisor on the acquisition?

Anna: International legal support to any global business and trade is at the core of in-house legal function. For this transaction, Dentons was an easy choice, as they met all the critical elements for a successful partnership. Dentons had a very experienced M&A team in the countries where the target had a presence and was ready to meet Ciklum’s ambitious timelines for closing the transaction. Also, they knew our business from previous projects and were ready to provide additional legal services required for the deal.

We were happy to work with Dentons and their team was dedicated to the project and responsive to our various requests.  

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