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Are Acquisitions Helping Accenture’s Interactive Business Unit?

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Aug. 3 2018, Updated 6:33 a.m. ET

HO acquisition strengthens presence in Asian market

In order to boost its Interactive Group’s business, Accenture (ACN) continues to acquire digital marketing companies. In July, Accenture finally completed the acquisition of Shanghai-based digital marketing group HO Communication. In May, the tech giant struck a deal with the Shanghai-based firm to acquire its assets. However, the financial terms of the transaction were not disclosed. After the acquisition, HO Communication has become a part of the Accenture Interactive unit.

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The acquisition allows the tech giant to gain access to the strong client portfolio of the HO Communication spread across important cities in China. The HO Group, which specializes in content creation, digital design, and branding could gain a competitive advantage once combined with the Accenture Interactive unit. Previously, the Accenture Interactive unit also bought PacificLink Group in Hong Kong in 2015. Such an acquisition in the Asia-Pacific region could continue to boost its market share going forward.

Past acquisitions are driving business

In January 2018, the company bought French-based digital commerce agency Altima followed by the acquisition of German-based 3D product manufacturer Mackevision in February this year. In May 2013, it also acquired a global service design consultancy, Fjord, which has some prominent customers like Nokia (NOK), PayPal (PYPL), Qualcomm (QCOM), and Telefónica (TEF).

Accenture’s new business concept, which consists of Accenture Interactive, Accenture Applied Intelligence, Accenture Industry X.O, and Accenture Mobility, continues to generate strong business momentum buoyed by increased demand and higher adoption across different industries. Accenture Interactive remains a key driver of the new business. The company has already made huge investments and acquired many firms to boost its Interactive business.

The graph above shows revenue growth of Accenture’s consulting business in the last five quarters.

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