Case study

Neusoft boosted by acquisition of Finnish mobile solutions company

Bringing together Finnish mobile software specialists and Chinese engineers has strengthened the competitiveness of China's leading IT solutions and services provider.

Neusoft is the leading IT solutions and services provider in China, with more than 17,000 employees and operations around the world. Founded in 1991, the company has been recognised as one of the 2010 Global Services 100 and the Top IT Outsourcing Vendors. Neusoft serves a diverse set of large corporate customers worldwide providing product engineering solutions and services.

 

In recent years, Neusoft has been building significant mobile expertise and now employs more than 1,200 highly skilled engineers in mobile solutions development and testing. Neusoft mobile solutions customers include Nokia, China Mobile, as well as Japanese and US phone makers.

 

Neusoft’s arrival in Finland was also motivated by its mobile business. Soon after establishing its subsidiary in Europe in January 2009, Neusoft was already looking to acquire companies in the mobile, automobile and health care sectors. “Acquisition is the fastest way to enter a new market, and the financial crisis pushed Neusoft to move faster,” explains Liu Jiren, Chairman & CEO of Neusoft Corporation.

 

After visiting four other companies in Europe, Liu set his sights on the Finnish software company Sesca. In August 2009 Neusoft signed an agreement with Sesca Group Ltd., acquiring Sesca’s mobile phone software development and testing business operations in Finland and Romania in a EUR 1.1 million deal. Under the agreement, Sesca’s subsidiaries Sesca Mobile Software Oy, Almitas Oy and Romania-based Sesca Technologies SRL have been integrated into Neusoft’s global mobile solution business unit, with nearly 250 employees in Europe. The new company was named as Neusoft Mobile Solution Group (NMSG).

 

“Thanks to this acquisition, we have significantly strengthened our expertise in mobile phone software development and testing. Sesca’s know-how is world class, and by uniting the business operations of Sesca and Neusoft, we can become one of the leading global companies in mobile phone software development and testing,” says Liu Jiren.

 

Neusoft’s business in Europe has increased five-fold since the acquisition of the Finnish mobile software business, boosting the profits of the whole company. Bringing together Finnish mobile software specialists and Chinese engineers has clearly strengthened the competitiveness of the company.

 

“By taking advantage of the Chinese price level and the Finnish quality, we can now compete with any competitor. Neusoft is now in a good position to grow by 50% in the future,” says Liu Jiren confidently. He remembers meeting Sesca’s workers for the first time and explaining that he needs their expertise because Finland is like the home town of the mobile phone.

 

“I told them ‘I really need you guys. You have a lot of experience and the first-class mobile software engineers in the world. Your competence is not only required for the European and American markets but also for the Chinese market, which is developing quickly.’”

 

Liu Jiren believes that along with China's rapid economy growth and its integration into the world economy, the emerging markets will become an emerging power in the global innovation network. Open innovation and collaborative innovation will become the most important driving forces to the development of global economy. “Outsourcing in the post-crisis era will create more value for enterprises to gain growth momentum and sustainable development, and Chinese services providers are playing more and more important roles in the global outsourcing community,” he says.