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BUCHAREST (Romania), February 17 (SeeNews) - Romanian online retailer eMag said on Friday it has invested 1.7 million euro ($1.8 million) in Romanian software company Zitec, acquiring a minority stake in the company.
Zitec will use the capital infusion to increase its headcount, to expand into other cities in Romania and to create a department dedicated to European funds and grants, it said in a press release. Also, the company aims to grow its client portfolio in Western Europe and USA.
"We remains an independent entrepreneurial company, a fact which made this transaction possible, besides a very good alignment of strategic objectives," Zitec CEO said Alexander Lapusan said.
Zitec's management will remain unchanged.
"This strategic transaction will allow us to continue the accelerated development of extensive local and regional projects with a major impact on the market, with the support of a competent partner in advanced IT services," eMAG CEO and shareholder Iulian Stanciu said.
Founded in 2003, Zitec currently has some 115 employees and offers a complete range of services which includes IT consulting, planning and developing web projects, SEO optimization and performance marketing. Its net profit doubled to 4 million lei ($ 671,100/597,500 euro) in 2016, from 848,765 lei in the previous year, according to data posted on the finance ministry website.
In September, Zitec acquired local web-design and digital services company Inotec for an undisclosed sum and said it plans similar acquisitions.
Some 40% of Zitec's revenues come from projects developed for foreign clients, mainly from the US, Canada, the UK, Germany, Switzerland, Italy and the Netherlands.
Online retailer eMag was founded in 2001 by Romanian entrepreneurs, and later expanded in Bulgaria, Hungary and Poland. South Africa-based Naspers media group acquired a 70% stake in eMag in 2012.
In April, it acquired Romanian online IT&C retailer PC Garage Store, with an undisclosed sum.