FTSE 100 tech firm Sage eyes expansion in Hong Kong
The decision of the management software business comes amid a push by the city to attract global technology companies to operate and list here
British technology company Sage Group is planning to expand its business in Hong Kong and China where it hopes to tap the vast number of small and medium-sized firms.
The decision of the FTSE 100 management software business to open an office in Hong Kong as it seek further expansion opportunities comes amid a push by the city’s regulators to attract global technology companies to operate and list here.
The Hong Kong government has urged financial regulators including the Hong Kong Monetary Authority and the Insurance Authority to do more to promote the fintech industry. Meanwhile the Securities and Futures Commission is working with Hong Kong Exchanges and Clearing to carry out the biggest listing reforms in three decades in a bid to attract large biotech and other technology firms with multiple classes of shares to float here.
The purpose is to help the city, traditionally strong in finance and trading, to catch up with the US and other markets in developing new technology sectors and supporting start-ups.
Such efforts have started to yield some fruit, with some established firms deciding to come here. In October, the Swiss firm Avaloq, which supplies cloud-based solutions to big banks such as HSBC, said it was eyeing expansion in Hong Kong and China.
Sage, one of the world’s largest management software suppliers for accountancy, payroll and human resource management software, is planning to set up an office in Hong Kong this year as a gateway to expanding to mainland China.
“China and Hong Kong together have 50 million small and medium-sized companies, which is more than 50 per cent of the world’s total. They are the target clients of Sage,” said Kerry Agiasotis, executive vice-president of Sage Asia during a recent visit to Hong Kong.
The company was set up almost 40 years ago in the UK by David Goldman, who developed software for companies to replace manual printed spreadsheets and enhance efficiency in handling their accounts. By expanding through a combination of partnerships, mergers and acquisitions, the company now has three million customers worldwide, in 23 countries. Clients who pay a monthly fee can access its sophisticated software via cloud technology.
Agiasotis said the company would like to adopt the same strategy to expand in Hong Kong and China.
“We always keep an eye on good merger and acquisition opportunities, while we also want to expand through partners such as banks or other platforms that have access to SMEs,” he said.
“Hong Kong is an ideal place as a hub as it has a lot of international companies setting up their offices here. It is also close to China, which is opening up to international investors.”
He said SMEs worldwide now employ 70 per cent of the working population globally so it is vital these companies have the right software to handle their accounts, payroll and other human resources functions.
“Previously, only the very big companies had the ability to develop these types of software. Nowadays, our cloud-bases services allow any SME of any size, from anywhere in the world, to also access the software they need,” he said.