Fujifilm Business Innovation – Products, Competitors, Financials, Employees, Headquarters Locations

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Japanese tech giant Fujifilm Business Innovation has acquired a 28-year-old Sydney-based IT services company, in a deal that’s set to net the founder tens of millions of dollars. While the deal price was undisclosed, Fujifilm Business Innovation is expected to have paid around $100 million for MicroChannel Services, which was founded in 1995 by CEO Harach Lucas and has 200 staff. The Australian company generated $57.8 million in revenue in 2022 and almost $8 million in net profit, according to financials filed with the corporate regulator. It provides software implementation services to small and mid-sized businesses and enterprise clients, spanning Microsoft, SAP, IBM, Sage, MYOB and more. Analysis of more than 500 IT services deals in the last seven years by Aventis Advisors revealed the median enterprise value to revenue multiple for deals between $US50 million ($74 million) to $US100 million was 1.4 times, while the median enterprise value to earnings before interest, tax, depreciation and amortisation multiple was 12 times. The local business came onto Fujifilm’s radar two years ago, but the Japanese giant did not make a formal approach until last year. Advertisement
Learning from Australia
Speaking to The Australian Financial Review in his first interview outside of Japan, Fijifilm Business Innovation CEO Naoki Hama said the deal propelled the company one step further toward its goal of hitting 400 billion yen ($4.3 billion) in revenue by 2027. “Australia is a very important market for us. It will be a model for the global rollout of our products and services, and if there are good opportunities we’ll look for [more] M&A and joint ventures,” he said. “It’s been two years since we had our eyes on [MicroChannel] … It’s part of our effort to start our globalisation of the ERP [enterprise resource planning]. In Australia … digital transformation is very much advanced, and I think there are many things that Fujifilm Business Innovation can learn from the market.”
Fujifilm Business Innovation’s expansion into ERP solutions began in 2021, when it acquired Hoya Digital Solutions and used the deal to establish Fujifilm Digital Solutions in Japan. The MicroChannel deal propels its ERP business into global markets. In Australia, the Japanese company (a subsidiary of Fujifilm that was formerly called Fuji Xerox) generated about $760 million in revenue in the 2021 financial year. Advertisement
Too good to refuse
Mr Lucas said the company wasn’t for sale when Fujifilm Business Innovation came knocking, but for the first time in the company’s 28 years, they made an offer he couldn’t refuse. “We get approached quite often … monthly almost,” he told the Financial Review. “It took me a while to be convinced it was the right thing for the business. But what they bring to the business is really unique, and it was an amazing opportunity. “They’re effectively allowing us to run independently, as a full subsidiary. And they’re going to use us to embark on their ERP and business applications journey in the region.”
Fujifilm Business Innovation has previously acquired four Aussie businesses between 2010 and now, namely Upstream Solutions, Salmat Document Management Solutions, CSG and its subsidiary Code Blue, as well as Smart Messaging Services. MircoChannel has more than 200 staff, all of whom will stay on with the company. Mr Lucas, who founded the business in 1995 based on the belief there was a need for a niche player in the ERP space, is taking on the role of senior executive advisor for Fujifilm MicroChannel Services. The new subsidiary will be led by Brett Matthews, who runs Fujifilm’s data management solutions business. Advertisement
The business has more than 1200 customers and has had consistent single or double-digit revenue growth each year. “Everyone will stay as is – I wanted to make sure the incoming party … valued all the people. We have very talented people, and we need everyone on board to scale,” Mr Lucas said. “It was a company that was willing to make a long-term investment. This isn’t a short-term turnaround [for Fujifilm]. “I’m committed to staying on as a senior executive advisor … I’d advise on strategy, how to grow the business, and I’ll be involved in acquisitions.“
Yolanda Redrup is an award-winning senior journalist who writes on technology, healthcare and occasionally covers Street Talk from our Melbourne newsroom. Connect with Yolanda on Twitter . Email Yolanda at [email protected]
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