EPAM Systems

Founded in 1993, Epam Systems (NYSE: EPAM) is a digital solution and platform developer and agency specializing in digital design and product design. Headquartered in. USA Epam works with clients worldwide in more than 35 countries, using its award-winning development centers in Central and Eastern To Europe and offices in countries, North America Latin America,,, Europe Asia and Australia.

Performance indicators

Main Article: EPAM Financial Performance

2023: 2.8% decline in revenue

Epam's revenue for 2023 decreased by 2.8% to $4.691 billion, the company said in its financial statements in February. Net profit amounted to more than $417 million, which is $2 million, or 0.55%, less than in 2022. Earlier in Epam, approximately such a decrease in revenue for 2023 and predicted - at the level of 3%, linking this with a decrease in the level of demand from customers. Read more here.

Business in Russia

Main article: RNT Group (formerly EPAM in Russia)

Ukraine-supporting Epam receives record billion-dollar dividend from Russian subsidiary in 2022

As TAdviser found out, in 2022, Epam Systems Inc., based in the United States, twice decided to pay dividends on the retained earnings of its Russian subsidiary Epam Systems LLC, of which it is the 100% owner. This follows from the explanations to the balance sheet and financial statements of the Russian Epam Systems for 2021 and 2022, published in the database of the Federal Tax Service of Russia. The total amount of dividends amounted to about 7.99 billion rubles.

So, on March 1, 2022, Epam Systems Inc, registered in Pennsylvania in the United States (Epam global headquarters), decided to accrue and pay a single participant in the Russian Epam Systems, i.e. itself, dividends in the amount of about 1.59 billion rubles for the period from 01.01.2020 to 31.12.2020 and about 1.16 billion rubles for the period from 01.01.2021 to 30.06.2021. Collectively, this is about 2.75 billion rubles.

Details of these dividends are contained in the explanations to the financial accounting of Epam Systems for 2021.

An analysis of the financial results of the Russian "Epam Systems," available in the database of legal entities "Kontur. Focus" for the period since 2010, shows that such an amount of dividends assigned to itself at the same time by foreign legal entities Epam from the retained earnings of the Russian one is already a record for this period. And, probably, for the entire duration of the Russian Epam Systems, since until 2010 its turnover and profit were much less.

American Epam Systems Inc received large dividends from its Russian legal entity in 2022 "(photo - Maura Andrade Guzmán, Facebook page *)"

In 2019, for example, in favor of the Cypriot company Epam, which at that time was the main founder of the Russian Epam Systems, about 659 million rubles were paid from its retained earnings of previous years. And in 2018, 62 million rubles were spent on dividends from the profit of the Russian Epam.

In addition to the 2.75 billion rubles mentioned above, the American Epam Systems Inc single-handedly made another decision on the distribution of the accumulated net profit of the Russian Epam Systems to dividends - in December 2022. This time in the amount of about 5.24 billion rubles. These data are contained in the explanations for the financial accounting of Epam Systems for 2022.

Whether this "jackpot," like 2.75 billion rubles, was fully paid to the only founder of the Russian "Epam Systems" - "Epam Systems Inc" from Pennsylvania - is not specified in the explanations to the financial accounting for 2022.

As of January 1, 2022, the total amount of retained earnings of the Russian Epam Systems amounted to 13.24 billion rubles.

Epam, we recall, after February 24, 2022 condemned the actions of Russia, announced its support for Ukraine, the termination of work with Russian clients and began to massively export people working for it from Russia to other countries.

It is also known that the global Epam donated money to the Ukrainian military and promoted this assistance. So, for example, in a partnership material dated September 2022 on Epam's assistance to "Ukrainians and the state," including through her Epam Ukraine Assistance Fund, it is said that evacuation cars were purchased for almost UAH 26 million for "defenders, clothes and shoes, helmets and body armor, equipment for demining territories and other^[1].

Epam was looking for a buyer for its Russian assets, but it did not work out by the scheduled dates. As of April 2023, the American legal entity Epam remains the 100% founder of the Russian Epam Systems. At the same time, the Russian company rebranded and now operates on the market under the RNT Group brand. For more information on this, see here.

* Facebook social network belongs to Meta, which in 2022 was recognized as an extremist organization and banned in Russia

Business in Ukraine

Main article: EPAM Ukraine

History

2024: Belarusian president pardons Epam employee convicted under article on participation in armed conflict

On September 4, 2024 Belarus Alexander Lukashenko , the president signed a decree releasing 30 political prisoners. These included 34-year-old resident of Brest and company manager Epam Diana Zavadskaya, who was convicted under the article on participation in the armed conflict. More here

2022

Sentence to Sergei Kiriyenko in Belarus in the amount of 3.5 years for comments on the social network

On October 3, 2022, the Gomel Regional Court sentenced 38-year-old Epam programmer Sergei Kiriyenko. He was accused under three articles of the Criminal Code of Belarus: Part 1 of Art. 130 (inciting social hostility or hatred), Art. 369 (insulting a government official), Art. 368 (insulting the President of Belarus). Read more here.

Capital Group becomes EPAM's largest shareholder

The group the American of funds Capital Group raised a 14.5% stake in an American offshore developer ON with - Russianthe Belarusian the roots of EPAM Systems. This became known on June 6, 2022.

Thus, the Capital Research Global Investors fund, which is part of the group, raised 11.5% of EPAM shares. Another 3% raised another fund of the group - Capital World Investors. With current quotations of EPAM shares on the New York Stock Exchange - $338 per share - the market value of this block of shares is $2.8 billion.

EPAM was founded by a native of, Belarus Arkady Dobkin who still heads the company. Dobkin owns a 3.4% stake in the company. The major shareholders of EPAM are American funds (WCM Investments owns 5.3%), & JP Morgan Chase Co (4.6%), Vanguard Group (10.8%) and (8.2 BlackRock %.). In May 2022, it became known that the Americaninvestment the company Morgan Stanley significantly reduced its stake in EPAM - from 8.4% to 0.7%. Thus, Capital Group became the largest shareholder of EPAM^[2]

Morgan Stanley cut to 0.7%

On May 4, 2022, it became known that the American investment the company Morgan Stanley almost completely withdrew from the capital of an offshore developer ON the Belarusian with the roots of EPAM Systems. This is stated in materials published on the website of the American Securities Commission (SEC).

Morgan Stanley's stake in EPAM Systems at the beginning of May 2022 is only 0.7%. At the same time, at the end of 2020, it was 8.4%.

At the beginning of 2022, the market value of the block of shares sold by Morgan Stanley was $2 billion. Morgan Stanley became a shareholder of EPAM in 2015. Then the company collected 5% of EPAM shares, then the size of the stake gradually increased.

EPAM's largest shareholders also include U.S. funds WCM Investment (it owns a 5.3% stake in the company), JPMorgan Chase & Co (4.6%), Vanguard Group (10.8%) and BlackRock (8.2%). Arkady Dobkin owns 3.4% of^[3].

Sale of 5.3% stake in WCM Investment Management

The American fund WCM Investment Management has collected 5.3% of the shares of the American outsourcing developer Epam Systems, which has Belarusian roots. Information about this is available on the website of the American Securities Commission (SEC). The market value of this package is $1.35 billion. This became known on February 17, 2022.

The WCM Investment Management Fund is based in the state of California. The main owners of the fund are its top managers: Paul Black, Kurt Winrich, Sloane Payne, Pete Hinkel, Mike Trigg, Sanjay Ayer, James Owens (Jamie Brawer David)

Epam's shareholders also include a number of other American funds: JPMorgan Chase & Co owns 4.6% of the shares, Vanguard Group - 10.8% of the shares, BlackRock - 8.2%, Morgan Stanley - 7.3%.

Epam founder and CEO Arkady Dobkin consistently sells his stake. At the beginning of 2021, he owned a 3.8% stake in the company^[4].

Losses of $19.57 million in the first quarter due to withdrawal from the Russian market

In the first half of 2022, Epam suffered impairment losses on long-term assets in Russia in the amount of $19.57 million as a result of the decision to cease operations in the country, the company said.

This amount includes tangible assets of $15.1 million; $3.8 million - from assets in the form of right of use; $0.7 - goodwill.

According to the results of the first three months of 2022, Epam reported that it had lost about $15.1 million due to impairment of fixed assets in Russia.

As noted in Epam in May 2022, the company is considering various strategy options for its Russian assets, including their potential sale or liquidation. Epam expects to cease operations in the Russian Federation by the end of the second quarter of 2022.

Epam lost $15.1 million in the quarter due to withdrawal from the Russian market, and in the first half of the year this amount increased to $19.57 million

In the second quarter of 2022, Epam said that the company could incur additional significant expenses related to the termination of its operations in Russia, including (but not limited to) restructuring costs and sale losses.

At the end of the first quarter of 2022, Epam recorded an impairment of assets from operating leasing of $3.8 million and goodwill (the company's intangible asset associated with its business reputation - IF) - of $0.7 million. These impairment expenses are included in the commercial, general and administrative expenses in the financial statements, the company clarifies.

In January-March 2022, Epam's commercial, general and administrative expenses turned out to be $237.3 million, which is 74% higher than spending a year ago. This includes expenses of $18.7 million for moving employees to other countries. It is expected that the share of Epam employees working in Russia, Belarus and Ukraine in 2022 will be halved - to 30% from 60% in 2021.

We believe that some customers may to some extent refuse to work in Belarus and Ukraine, but Epam is diversifying its geographical structure at a faster pace than expected, which in many cases is due to the relocation of existing EPAM employees, said Bank of America analyst Jason Kupferberg.[5]

Purchase of Enginiety Online Software Integrator

In late January 2022, Epam announced the acquisition Enginiety at a price the companies would not disclose. The transaction, as stated in the press release, will allow the buyer to expand the portfolio of comprehensive proposals for the creation and development of platforms in the field e-commerce for global adaptive organizations. For Epam, this is the first takeover since early 2022. More. here

2021

Purchase of digital television platform developer Optiva Media

In mid-December 2021, Epam announced the purchase of Optiva Media. The financial terms of the transaction were not disclosed. Read more here.

Purchase of Belgian digital agency Emakina Group

In early November 2021, Epam announced the purchase of Emakina Group at a price that the companies did not disclose. Read more here.

Detention in Belarus of an IT specialist Epam for subscribing to opposition Telegram channels

On October 18, 2021, it became known about the detention of the Epam programmer. Nikita Imekova- Telegram the channel of the main department for combating organized crime and corruption (GUBOPiK) MINISTRY OF INTERNAL AFFAIRS Belarus published a video in which the IT specialist apologizes for subscribing to Telegram channels recognized as extremist. In the same message, screenshots smartphone of Imekov's screen with a list of these very channels are attached. More. here

The death of a company employee Andrei Seltzer during the storming of the apartment by security forces

On September 28, 2021, the State Security Committee (KGB) of Belarus announced the death of its employee during the assault on the apartment of Epam employee Andrei Seltzer. Read more here.

Programmers from Uzbekistan will help Epam cope with a critical shortage of personnel

In recent years, demand for digital solutions has been growing worldwide, but there is a critical shortage of developers. In this regard, Epam began to invest even more actively in attracting developers from the countries of the former Union, Artak Hovhannisyan, deputy general director of Epam in Russia, told TAdviser. The company opens offices in these countries and hires and trains local professionals.

In countries such as, Ukraine, and Belarus Kazakhstan Armenia, Epam has long had development centers. Relatively new are the offices in and. To Lithuania Georgia Now there is an office in, too, Uzbekistan says Artak Hovhannisyan. As of mid-2021, about 150 specialists worked in it.

Artak Hovhannisyan believes that, in addition to Kazakhstan, of all the countries of Central Asia, Uzbekistan has the best reserve for nurturing IT personnel: there is basic training - schools and universities with specialized areas. But the main factor in favor of opening an office was the state policy towards IT: Uzbekistan is creating an IT Park high-tech park by analogy with what is in Belarus, the deputy general director of the company in Russia explained.

Epam is developing an office in Uzbekistan to nurture personnel for its company "(photo - eurasia.expert)"

The office also has a training center for training specialists. He conducts, among other things, free training for developers. For example, in February 2021, the company opened a free training in Uzbekistan in such areas as the basics of JavaScript, the basics of DevOps, automated software testing.

In July 2021, Epam called one of its main tasks in the country "ensuring the dynamic development of the representative office in the Republic of Uzbekistan, as well as nurturing IT specialists among the local population in order to train personnel for the company"^[6]

Due to different circumstances, IT specialists from Uzbekistan work mainly on Epam global projects. One of the reasons is that the new generation in many countries of the former Union knows English much better than Russian, notes Artak Hovhannisyan.

In the first half of 2021, Epam Systems' global revenue grew by about 29% compared to the same period in 2020, and in Russia - by 44%, Artak Hovhannisyan also told TAdviser. The company's global revenue at the end of 2020 amounted to $2.66 billion, which is 15.9% more than a year earlier. And the number of Epam personnel by the end of 2020 increased to 41.2 thousand employees, including 36.7 thousand production specialists, which is 12.8% higher compared to the same period of the previous year.

At Epam, revenue growth depends on headcount. Therefore, in 2021, the company could show even greater growth, but physically there are not enough developers and other specialists, for example, DevOps engineers or testers, said Artak Hovhannisyan in a conversation with TAdviser.

The demand for digital solutions both in Russia and in the world soared significantly in 2020, and in 2021 it is even greater. In 2020, in connection with the pandemic, those companies for whom it was a matter of business survival began to switch to digital in the first place. And in 2021, the digitalization process continued in these companies, plus they are being pulled up by companies that had not previously decided on certain projects in the field of "numbers," but now they saw real benefits in them and got a taste, explained Artak Hovhannisyan.

Lev Matveev, chairman of the board of directors of SearchInform, believes that attracting highly qualified specialists from the countries of the former Union is an excellent idea that Russian IT companies have not yet resorted to too actively. At the same time, we are talking not only about nurturing personnel on the ground, but also about their relocation to Russia. However, according to Matveev, in this case, the bet should be made primarily on Russian-speaking professionals.

I do not understand why Russia does not take advantage of the opportunity to involve highly qualified specialists from the former Soviet Union in orbit. Why are Poland, Lithuania and Latvia fighting for the IT brains of Belarus? Why is Russia not fighting? - said Lev Matveev, answering a TAdviser question at a Russoft press conference in September 2021. - It is necessary to attract not English-speaking specialists into orbit, but the same Moldova... The republics of the former Soviet Union - they are mentally close. If they create a quick acquisition of citizenship, some benefits, and so on, the question will move. You need to involve your closest neighbors with the same mentality.

Purchase of software developer S4N

In early August 2021, Epam bought a Colombian developer. ON S4N Financial terms of the transaction are not disclosed. More. here

President of Belarus Lukashenko accused Epam of financing protests

In August 2021, President of Belarus Alexander Lukashenko accused Epam and the head of the company Arkady Dobkin of financing the protest movement in the country.

Dobkin or Drobkin, as his last name there. This has already been established - he transferred money here to protest actions. And there he is associated with special services. They gave the money - they transferred it, and they shared it here. This is not normal, "Lukashenka said during a press conference on August 9, 2021.

Alexander Lukashenko accused Epam of financing protests

The President of Belarus also noted the position of the state in relation to the IT-Business (the IT market of Belarus) as a whole. After the harsh suppression of protests dissatisfied with the results of the presidential elections, technology companies began to actively transfer employees from Belarus to neighboring countries.

We'll figure it out there. Let them take their time in Belarus, let them work better in Ukraine. We will not clamp them down, we will not interfere with their work, these IT specialists. But we must see all financial flows - we initially agreed on this - this is a narrow neck, money came here, get it for your work, "Lukashenka said.

Arkady Dobkin, commenting on the statement of Alexander Lukashenko, noted that "he cannot be called pleasant or long-awaited." According to the entrepreneur, Epam has been doing business in Belarus and other countries for more than 25 years, treats it responsibly and "with a full understanding of all associated global and local risks."

Our responsibility to employees, clients and investors has never allowed us to take rash and unlawful steps that could lead to risks of violation of the company's production activities, or, more simply, to loss of reputation, "Dobkin said.

Regulation by the board of directors and numerous international audits "leaves no room for incorrect interpretations, assumptions or comments," he is sure.^[7]

Purchasing Salesforce Solution Integrator

In July 2021, the cost of selling Ricston to Epam became known - $10 million. This amount includes $7.9 million, which the buyer gave immediately after the closing of the transaction, as well as a deferred payment of $1.3 million. In addition, depending on Ricston's performance, payments totaling $2.1 million can be made to its company owners. Read more here.

Purchase of Just-BI consulting company implementing SAP software

In May 2021, Epam announced the purchase of Just-BI at a price that the companies did not disclose. This deal is supposed to expand consulting services for clients from countries [[EU [[and Asia-Pacific and will strengthen Epam's existing practices of Data, Business Intelligence and Advanced Analytics. More here.

Purchase of PolSource CRM Integrator

In May 2021, Epam announced the purchase of PolSource. The deal is scheduled to close in the fiscal second quarter. It must first be approved by regulators. Read more here.

Purchase of the Israeli information security company White-Hat

In early May 2021, Epam announced the acquisition of the Israeli information security company White-Hat. The transaction, the financial terms of which were not disclosed, will expand Epam's expertise in the Zero Trust concept and diversify the client portfolio in the markets of Europe, the Middle East, Africa. Read more here.

2020

Entering the ranking of the most efficient companies developing digital products according to Forrester

Forrester on July 29, 2020 presented a "rating of the most efficient digital product companies." As part of the comprehensive assessment, all participants were evaluated according to 29 criteria, 12 providers were included in the top rating: BCG, Bresslergroup, Cognizant, EPAM, frog, Harman, Huge, Slalom, ThoughtWorks, Virtusa, WillowTree and Wipro. Read more here.

Buying fintech company Deltix

On March 20, 2020, Deltix announced a deal in which the company was sold to software development solutions makerEpam Systems. The financial component of the agreement has not been disclosed, as well as other conditions. Read more here.

2019

Purchase of the developer of the cloud platform for testing Test IO software for $17.3 million

In early December 2019, it became known about the sale of the developer of the cloud platform for testing software Test IO to Epam for $17.3 million. Read more here.

Buying a Database Migration Software Developer to the NAYA Cloud

In early November 2019, Epam Systems announced the purchase of NAYA Technology. The perimeter of the deal includes the migVisor tool developed by the Israeli startup, designed to assess automated database migration and help move Oracle and SQL server databases to public clouds, including Amazon Web Services, Microsoft Azure and Google Cloud Platform. Read more here.

Creating a fund to invest in blockchain and IT startups

In February 2019, EPAM Systems announced the creation of the Global Opportunity Philly Fund (GO Philly Fund), money from which will be allocated to technology companies, including developers of blockchain and cryptocurrency solutions. Read more here.

2018

Buying a digital consulting agency TH_NK

On November 1, 2018, Epam Systems announced the purchase of digital consulting agency TH NK to strengthen its position in the markets of Britain and Western Europe. As a result of the transaction, the value of which was not disclosed, the acquired company will join the direction of Epam Consulting and Digital Engagement Practices. Read more here.

Opening an office in the city of Malaga in Spain

In October 2018, EPAM, a custom software developer, opened another office in the resort town of Malaga in Spain. This step was taken as part of the expansion of the organization's representation in Europe.

The office is formally divided into two main departments - a digital studio and a distribution center. As of October 2018, the office has 50 employees, during 2019 it is expected to expand the staff to 200 people.

EPAM needs employees from various areas of activity. The company needs engineers, financial specialists, software developers. EPAM searches for employees not only in Spain, but also throughout Europe, the CIS, Latin America and the countries of the Asia-Pacific region, and an office on the coast of a hot resort country is an additional incentive for specialists to become part of the EPAM team.

The EPAM office in Malaga should become a center for consulting services and software development. The company already has similar centers in Hungary, Poland, the Czech Republic and Bulgaria.

The Malaga office for October 2018 is already working with international hedge funds and investment banks in full compliance with European and North American financial regulations and laws, as well as numerous retail clients around the world^[8].

Buying consultancy Continuum

In mid-March 2018, Epam Systems announced the purchase of the consultancy Continuum. The company did not disclose the value of the transaction. Read more here.

2016: Vanguard Group entered EPAM papers

On February 11, 2016, it became known about the purchase by the American fund Vanguard Group of a stake in EPAM in the amount of 5.9%. Its market value is more than $232 million (for 31.12.2015 years)^[9].

At the end of 2015, EPAM shares were sold at $80, followed by a decline and as of February 11, 2016, the shares were trading at $58.

2015

Purchase of Alliance Global Services

On November 15, 2015, Epam announced the purchase of software developer and automated testing solutions Alliance Global Services. The value of the transaction is not called.

According to Epam, through this acquisition, the company expects to expand its capabilities in North America and India, strengthen expertise in the field of automation of software development processes, interact more closely with North American customers and increase the network of global development centers through two new Alliance Global Services located in the Indian cities of Hyderabad and Pune. Read more here.

Brand change for $20 million

On April 1, 2015, it became known about the cost of changing Epam's corporate identity. The company will spend about $20 million on updating and promoting it. The official launch will take place in May 2015^[10].

The first mention of the upcoming rebranding appeared in the Belarusian press in January 2015. At the same time, the company published a sample of a new corporate identity, whose authenticity at that time was not confirmed.

New company logo, 2015

The company logo has been known since 1998. Andrei Azarov is the author, in 1999-2001 he worked as a designer, then as an art director at EPAM Systems.

New company logo, 2015

Elaina Schechter, Senior Vice President, Marketing Director of Epam Systems, confirmed the company's work on a new brand and corporate identity. Third-party developers were not involved in creating the image, she said - the Epam division, "specializing in projects for the digital transformation of customer business," formed recently, is involved. Most of the employees of this division work in the United States.

Elina Schechter did not confirm, nor did she deny information about $20 million in rebranding costs, noting that the company "does not provide separate reporting on marketing costs, and therefore cannot allocate the amount of resources spent on rebranding."

Work on changing the image of Epam will continue for about two years. In addition to the direct costs of changing the corporate identity in Epam Systems offices in 18 countries of presence, this amount includes spending on promoting a new brand in various information channels, including the payment of evangelicals.

The official launch of the new Epam Systems brand will take place in mid-May 2015.

Pennant Capital pulled out of Epam Systems equity

On March 19, 2015, Pennant Capital USA , which bought a 5% stake in Epam a year ago, withdrew entirely from the company's capital. The sold stake is estimated at $145 million^[11]

Pennant Capital Management Fund has fully withdrawn from Epam Systems capital - the relevant materials have been published on the website of the US Securities Commission.

Among the largest shareholders in Epam, Pennant Capital entered 2014. Then the fund acquired 5.1% of the company's shares. As of March 19, 2015, the cost of this package is $145 million, a year ago it cost $100 million. Pennant Capital hedge fund was founded by Alan Fournier in 2001. The value of the fund's portfolio as of December 31, 2014 is $5.567 billion.

Epam led an IPO in early 2012. In 2013-2014, the company held five additional placements, during which its shares were sold by the once largest shareholder of Epam - the group of funds Russia Partners. Prior to the IPO, Russia Partners had a majority stake in Epam.

Top five Epam shareholders at 20.03.2015, 2015

President and founder of Epam Arkady Dobkin partially sells his stake: after the IPO, he had a 12.5% stake in the company, as of March 19, 2015 ~ 4.4%.

After the IPO, Epam has a number of large shareholders:

• In the fall of 2012, Fidelity Managment & Research raised a 12% stake in the company,
• in 2014, the Waddell & Reed fund acquired a 7% stake in Epam.

Now the shares of these funds have decreased.

In early 2015, it became known about the appearance among the large shareholders of Epam of the investment company JPMorgan Chase. She collected a 6.6% stake in the company.

A year ago, EPAM securities experienced a significant drop, falling from $44 to $30 per share. This was due to events in Ukraine, where Epam has part of the development centers. Then the quotes went up and on March 19, 2015, Epam shares traded at $61.5 per share.

2012: Failed IPO on NYSE

EPAM Systems announced in January 2012 the start of an initial public offering (IPO). Under favorable market conditions and other conditions, the total offering will be 7,400,000 ordinary shares. 1,517,647 shares owned by the company itself and 5,882,353 shares held by other EPAM shareholders will be offered for sale. In addition, the company will grant underwriters an option to purchase up to 1,110,000 additional shares within 30 days of offering if bids are exceeded over the offer. According to preliminary estimates, the value of one EPAM share will range from $16.00 to $18.00. The New York Stock Exchange (NYSE) was chosen as the venue for the IPO, in the quotation list of which the company will appear under the symbol "EPAM."

The company plans to use the funds raised during the IPO to achieve corporate goals, such as increasing working capital, developing production infrastructure, as well as investing in new technologies and acquiring companies, which will allow EPAM to expand the range of offers for customers. The company will not receive income from the sale of shares by existing shareholders.

EPAM and bookrunners are organized by Citigroup, UBS Investment Bank, Barclays Capital and Renaissance Capital, and investment banks Stifel Nicolaus Weisel and Cowen and Company are co-organizers.

On February 8, 2012, EPAM Systems held an initial public offering (IPO) on the New York Stock Exchange. The offering price was $12 per share. After the placement, quotes went up, at the time of publication one share was sold for $14.58.

However, such figures are below the originally planned offering corridor of $16- $18 per share. The organizers of the IPO itself - Citigroup, UBS Investment Bank, Barclays Capital and Renaissance Capital - were estimated at $650 million - $730 million, the volume of placement was supposed to be $118 million - $133 million.

As a result, the volume of placement amounted to $72 million ($46 million - $61 million less than planned), and the company reached capitalization at the time of placement of $490 million ($160 million - $240 million less than expected). EPAM itself did not discuss the results of the IPO^[12].

NYSE investors rated Epam approximately the same as the business of the Russian Luxoft (division), IBS and much cheaper than similar Indian companies and, Infosys TataVTB Anastacia Obukhova and Natalya Pichugina, capital analysts, admit in the report. They believe that the reason for this is not problems with the performance of Epam itself, but the unsuccessful choice of the moment for the IPO: the difficult situation in the financial markets, uncertainty with the IT budgets of Russian companies and organizations, as well as the "Belarusian factor" in politics.

During the placement, 6 million shares were sold (15% of the total), while at first it was planned to sell 7.4 million shares. Who sold the shares and how much is not known now. According to the initial plan, EPAM itself was supposed to sell 1.5 million shares and gain, respectively, $24 - $27 million, existing shareholders - 5.9 million shares for $92.8 million - $104.4 million.

The general director and founder of EPAM, a US citizen of Belarusian origin Arkady Dobkin planned to earn $8.78 million - $9.88 million on the IPO, reducing his share from 14.1% to 12.1%. Now we can only say that the package that Dobkin had before the IPO at the time of placement cost $65 million. The package of another founder Leonid Losner, respectively - $30.6 million.

Symbolic bell ringing signifying the start of trading in EPAM shares on the New York Stock Exchange

The largest seller of shares during the IPO was supposed to be the investment company Siguler Guff, whose funds are managed by Russia Partnres. The company was going to raise $59.4 million - $66.9 million, reducing its stake from 52% to 41% of the shares. So far, we can say that the cost of the entire package she had at the time of placement was $201 million. Siguler Guff acquired EPAM shares in 2005 for $20 million, thus, in seven years, the value of its shares increased 12 times.

VTB-Capital was going to sell 1.7% of the shares during the placement for $47.9 - $53.9 million. The next day after the placement, it was known that the cost of the entire package belonging to the fund at the time of placement was $36 million. VTB-Capital acquired EPAM shares in 2010 for $19.3 million, now this package has risen in price 1.9 times.

The results of the IPO were worse than expected due to the fact that just a week earlier the upcoming IPO of the social network Facebook was announced. "Facebook plans to attract about $10 billion and the interest of investors in the IT sector is directed, first of all, to this company," says Maxim Rybin, head of the Finam corporate finance department. "With such a large offering, you should not conduct an IPO at the same time in the same sector, and EPAM should have done this either last fall, when nothing was known about Facebook's IPO, or after the placement of shares in the social network."

In addition, the rapid announcement of the final date for the offering of EPAM shares played a negative role.

"We only learned about this about a week ago, as a result, during the remaining time, we were unable to prepare the necessary materials about EPAM and did not offer the company's shares to our customers," Rybin adds.

A decrease of a third in the placement price of Epam shares is bad news, the owner of Epam shares, who wished to remain anonymous, told Vedomosti. "But this is at least some kind of liquidity," he rejoices. The owner of the stock believes that the main reason for the underestimation of Epam compared to Chinese or Indian competitors is that the company advertised itself among investors as a European business, and those do not believe in Europe^[13].

2011

Opening the Competence Center for Mobile Solutions

In September 2011, EPAM Systems announced the opening of the Competence Center for Mobile Solutions. Its creation will help consolidate the wealth of experience and knowledge accumulated by EPAM in the course of implemented projects for the development and development of mobile applications for customers in Russia, Europe and the USA. The center will focus on providing services such as developing, testing and supporting solutions for working with corporate information systems through mobile devices, creating business applications and frameworks for Apple iOs platforms (iPhone/iPad), Android, Blackberry, Windows Mobile 7, Symbian, etc., design and design of user interfaces. The first project in the field of mobile technologies - the development of a framework for creating mobile applications commissioned by one of the leading manufacturers of corporate information systems - was implemented by EPAM in 2005. Now the clients who chose the company's services in this area include organizations of the financial and insurance sectors, media business, trade, FMCG, transportation and tourism industries, as well as software vendors . The horizontal EPAM experience includes the development of relatives (Apple iOs (iPhone/iPad), Android, Blackberry, Windows Mobile 7, Symbian, etc.) and web applications, mobile portals and solutions for mobile commerce, applications for accessing corporate services and systems through smartphones and tablets, solutions for delivering information and content to the user depending on his location, etc.

The organization of the Competence Center allows you to expand the company's expertise in the field of mobile applications. It became possible to make the best use of the accumulated experience in future projects, optimize the exchange of knowledge and developments within EPAM and ensure the constant growth of the qualifications of specialists. This helps to quickly and efficiently respond to the demand for the development of business applications for mobile devices, which is caused by the rapid spread of smartphones, communicators and tablets. According to IDC, in 2011 the global sales of smartphones will increase by almost 49.2%, in terms of production, smartphones and tablets can bypass personal computers for the first time in the history of the IT market. In Russia, last year, smartphone sales increased by almost 50% (according to MForum Analytics). So it is logical that Western and Russian companies of the financial and insurance sector, e-commerce, transport, tourism and entertainment industries, etc. are actively interested in the opportunity to attract the audience made up by users of mobile devices. With the creation of the Center, EPAM will be able to offer mobile solutions and platforms that will take into account the industry and business specifics of customers and fully meet their current and future tasks.

Opening of the Competence Center for Salesforce.com Technologies

EPAM Systems has opened a competence center for the company's technologies Salesforce.com (a global developer of enterprise cloud services). The center's specialists will participate in the development, implementation and integration of new components for one of the flagship salesforce.com products - a platform Force.com that is used to create business applications, websites and mobile solutions and is delivered on the basis of Platform as a Service -. PaaS This will help provide salesforce.com end customers with advanced capabilities to maximize cloud utilization.

Announcement of US IPO plans

Epam Systems announced its intention to conduct a public offering (IPO), which was notified to the U.S. Securities and Exchange Commission on June 10, 2011. On this day, a preliminary prospectus was published, which indicates the company's intention to raise $100 million on the placement of its securities. At the same time, Epam does not provide many interesting details about the future of the IPO. There is no information in the prospectus about how many shares the company intends to place, what shares of the company are owned by its shareholders, and even on which exchange it plans to conduct an IPO. The missing details of the document may be acquired in the near future: in the prospectus there is a warning that the information provided in it is incomplete and can be changed. It is now known that Epam's share capital consists of ordinary and preferred shares, with both types of shares eligible to vote. Preferred shares were issued in three tranches: in 2006, in 2008 and in 2010. A private offering of 657,354 Series A-1 preferred shares in 2006 was made in the amount of $8 million (at a price of $12.17 per share). The acquirer through its two subsidiary funds Russia Partners II and Russia Partners Epam Fund was the New York-based investment company Siguler Guff .

Opening of a development center in Poland

EPAM Systems opens a development center in Poland. The Polish office will organically complement existing European development centers and customer support centers in Russia, Hungary, Belarus, Ukraine, Germany, Great Britain, Sweden and Switzerland. The choice of a place to create a new center is due to the need to grow and strengthen strategic relations with existing European customers and partners, as well as the prospects for the development of the custom software development market in the region. In this regard, Poland, due to the availability of qualified IT personnel, economic stability and geographical location of the country, is one of the key markets for EPAM. Universities in Krakow produce about 180,000 young professionals each year. Polish students regularly take prizes at international IT competitions: TopCoder, International Olympiad in Computer Science (IOI), Google Code Jam, International Student Programming Olympiad (ACM) and others. All this ultimately provides favorable opportunities for the development of the company. The ERAM plans to expand the staff of the development center in Krakow to 150 people by the end of 2011.

2010: Becoming an SAP Gold Channel Partner

In November 2010, the company received SAP Gold Channel Partner status (the highest partner status under the SAP PartnerEdge program). The interaction of companies began in 1997, when EPAM became involved in the development of SAP software products. Since 1999, a dedicated SAP competence center has been operating. Since 2004, EPAM Systems has implemented consulting SAP-based practices for both CIS and CIS customers within the SAP Competence Center Russia.

2008

In 2008, Renaissance Investment Management, Da Vinci Capital and Euroventures Capital^[14] paid $50 million for a stake^[14] company].

Purchase of B2BITS

In April 2008, Epam Systems, with over 4,000 employees, announced the purchase of B2BITS, a provider of solutions and consulting services to professional stock market players.

B2BITS 's extensive industry experience and high-tech products, combined with the scale and effectiveness of Epam's mission-critical business application team of financial sector more than 600 people, will provide customers with a full range of services - from expert analysis and consulting in the field business processes to the implementation of customizable solutions, as well as 24/7 development, testing and support ON. All of these services will be provided through a specialized Competence Center led by B2BITS President Mark Bisker, an industry veteran with more than 25 years of experience with technology companies such as Schwab Capital Markets and Lava Trading.

Epam bought Plusmikro in Kazakhstan

On April 2, 2008, it became known about the takeover of the Karaganda developer of Plusmikro programs by Epam Systems. The combined company continued its operations in Kazakhstan under the name Plusmikro. Plusmikro was formed in 1987. Its main client is the tax service of Kazakhstan.

"After the merger with Plusmikro, Epam will be able to enter the Kazakhstan market with solutions and experience that has accumulated over 14 years of working with large corporations," said Anatoly Haverdovsky, Senior Vice President of Epam Systems. - On the other hand, the merger is an opportunity to invest in new jobs and professional development of citizens of Kazakhstan. The condition for the merger of companies is the exchange of shares. The details of the birth of a new player in the software market Epam and Plusmikro chose not to be announced, conditioning this on a commercial secret.

2002-2005

2005 - opening of new Development Centers in Ukraine and Russia;

2004 - merger with Fathom Technology; opening a new Development Center in Russia; The number of employees amounted to more than 1000 people;

2003 - EPAM Systems is the first in Europe to be certified according to the SEI CMMI Maturity Level 4 quality standard; a new Development Center has been opened in Belarus;

International ISO:9001 Quality Certificate received; opened a new Development Center in Russia; The EPAM Systems Educational Center has been opened.

2005: Opening of new development centers in Russia and Ukraine

In 2005, the company opened new Development Centers in Russia and Ukraine.

2002-2004

2004 - merger with Fathom Technology; opening a new Development Center in Russia; The number of employees amounted to more than 1000 people;

2003 - EPAM Systems is the first in Europe to be certified according to the SEI CMMI Maturity Level 4 quality standard; a new Development Center has been opened in Belarus;

International ISO:9001 Quality Certificate received; opened a new Development Center in Russia; The EPAM Systems Educational Center has been opened.

Services

Epam Systems provides services in the following areas:

• Custom Software Development
• Creation of dedicated development, testing, support centers
• Testing and QA
• Implement and integrate IT solutions
• Support and maintenance of information systems
• IT consulting
• Development of digital strategies

Decisions

EPAM specializes in developing solutions in such areas as:

• E-commerce
• Remote service, including Internet banking
• Mobile apps
• Big Data, Analytics
• Digital Marketing, Digital Strategies
• Content Management
• Business Process Management
• Collaboration Support
• Accounting and Management, ERP, SCM
• Cloud Solutions and Services

Industries

Epam Systems offers solutions and services to customers in the following industries:

Finance and Insurance

• For financiers (programming and setting up relevant SAP modules R/3 and other ERPs; creating analytical software for managing and optimizing financial transactions, including in a multi-currency and multi-tax environment; creation and installation of online payment systems among customers)
• For Traders (Epam develops online trading software (including FOREX))
• For insurers (Epam solutions allow insurers to create, customize, and direct their offerings to agents and consumers)

Retail

• E-Commerce for Retail Sales
• Customer Relationship Management Systems for Retail Sales
• Data stores
• Management of trucking claims
• Enterprise Scale Application Integration (EAI)
• Integration of Computer Aided Design and Manufacturing (/ CAD CAM) Systems
• Content Management

Mechanical Engineering, Transport and power

• Production management solutions
• Customer Interaction Management (CRM) solutions
• Online inventory management solutions, including invoice accounting, shipment and receipt, and equipment maintenance
• Purchasing management solutions
• automation of working time accounting;
• processing; barcodes
• cost accounting and pricing

High technology, software production

• outsourcing IT services and software development;
• e-business solutions;
• Customer Relationship Management (CRM) solutions
• information database technologies;
• Enterprise System Integration (EAI) services
• content management (CMS) solutions

Notes