UK integrators set to expand in Latin America

Expanding economy and offshoring growth prompt Logicalis and DataPoint to up their game in Latin America

Ian Cook: Only India and China will outpace Latin America economic growth.

Latin America’s buoyant economy and emerging status as an offshore hub are proving a magnet for UK-based systems integrators.

Cisco Gold partner Logicalis has become the latest VAR to acquire in the region, while rival DataPoint has also revealed plans to initiate a local presence.

Logicalis’ move on Brazil-based Promon Tecnologia takes its annual Latin American turnover from $70m to $250m (£35m to £125m). It now claims to be the region’s largest network integrator with offices in Brazil, Argentina, Uruguay, Chile, Peru and Paraguay.

Logicalis will take a 70 per cent stake in a new holding firm, PromonLogicalis, which will own Promon Tecnologia and Logicalis’ existing regional operations.

Ian Cook, chief executive of Logicalis, said: “With the exception of India and China, the Latin American economy is forecast to grow faster than anywhere else,” he explained.

“This extra investment gives us a third leg in Latin America, alongside Europe and the US. We would anticipate each region providing us with significant profits, which will reduce business risks and make it easier for us to serve international clients.”
Cook said Promon’s Brazilian operation could act as a springboard into other Latin American markets.
He added that Logicalis, which is aiming to double turnover to $2bn within three years, is also hunting for acquisition targets in the Czech Republic and Poland.

Meanwhile, pan-European systems integrator DataPoint is also considering a move into Latin America to meet the offshoring demands of its Spanish clients.

Martin Hill-Wilson, strategy director at Avaya partner DataPoint, said: “Our Spanish office is doing an increasing amount of work in Latin America. We have to be out there one way or another.”

Nick Grossman, corporate business development director at 2e2, which has offices in the UK and Benelux, said: “The BRIC [Brazil, Russia, India and China] countries are growing far head of the rates we understand in western Europe.

“However, we would not enter a territory opportunistically just because there is high growth there.”