Announcement of Acquisition of A-STAR Co., Ltd.
Announcement of Acquisition of A-STAR Co., Ltd.
SHIFT Inc. (“SHIFT,” headquartered in Minato-ku, Tokyo, Japan; Masaru Tange, CEO and Representative Director) announced today that it has entered into a definitive agreement to acquire a 100% equity interest in A-STAR Co., Ltd. (“A-STAR,” headquartered in Shibuya-ku, Tokyo, Japan; Toshinobu Takase, CEO and Representative Director).
Reason for the acquisition
As SHIFT has been expanding its software quality assurance business since 2009, it has served clients in a wide variety of industries, such as financial, retail, logistics, and entertainment. In its business activities, SHIFT has been trying to attain “a smart society without unnecessary disruption,” through promoting labor division in software development and agile and efficient software development. Moreover, toward achieving its growth strategy, “SHIFT 1000,” which aims at ¥100 billion of net sales, SHIFT has been strategically acquiring businesses to expand and enrich its service portfolio.
Under these circumstances, SHIFT has initiated to build its platform business since October 2019, aiming to 1) expand its business activities to realize “SHIFT 1000” and 2) resolve issues in the Japanese technology industry. In this platform business, SHIFT matches engineers to software development projects by visualizing the supply-demand gap related to “human resources,” “products,” and “money” in software development. SHIFT has built this platform business through utilizing a) information on software development projects in which SHIFT has been involved as a quality assurance specialist and b) information on “human resources” that SHIFT gained through its aggressive recruiting activities.
In order to expand business activities aimed at realizing “SHIFT 1000” and to further expand the platform business, which contributes to resolving issues in the Japanese software development industry, SHIFT has considered A-STAR, a company with informational assets related to “human resources,” “products,” and “money” as one of M&A targets.
As A-STAR operates its owned-media and runs a platform that matches freelance engineers to software development projects, SHIFT believes that A-STAR’s information on a wide variety of engineers will greatly contribute to the acceleration of SHIFT’s platform business expansion. Therefore, SHIFT has decided to welcome A-STAR to SHIFT Group.
In addition, SHIFT believes that the media A-STAR operates will contribute to increasing the awareness of SHIFT Group. In order to further strengthen hiring, which is another focus area for SHIFT to accelerate organic growth, besides the platform business, and to accelerate and strengthen new service models such as DAAE*1, SHIFT believes it is crucial to strategically increase its brand recognition the media that is widely recognized by engineers.
By participating in SHIFT Group, A-STAR can strengthen its service functions by increasing the number of referral projects. By accessing SHIFT Group’s wide-ranging information on software development projects, from the enterprise industry to the entertainment industry, SHIFT believes that A-STAR will be able to grow even more by raising matched transactions.
Having A-STAR as a SHIFT Group company, SHIFT continues to accelerate the achievement of “SHIFT 1000” through aggressive M&A activities and the expansion of platform businesses, in addition to the growth of existing businesses.
*1 “DAAE,” which abbreviates Design, Agility, Assembly, and Economic Quality. In future Japan’s technology industry, SHIFT expects that engineers will face more challenging and sophisticated demands from users, more competitive market environments and more requirements to shorten development cycle time. Under these circumstances, it will be crucial to develop services centered on DAAE, replacing the concept of “QCD,” which is widely insisted to be essential in Japan’s conventional manufacturing industry.
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