Hyderabad: IT services provider, Visualsoft Technologies, a testing services company AppLabs Technologies, and Chennai based eSolutions have merged. The combined entity will be called VisualSoft Technologies.
The merger is subject to regulatory approvals from the Indian stock exchanges and the Andhra Pradesh and Tamil Nadu High Courts.
The combined entity will provide software testing, product development and services and will serve more than 400 customers globally and will have over 1800 employees.
Sashi Reddi, a seasoned entrpreneur and business strategist and currently the CEO of Applabs has been appointed the CEO of Visualsoft Technologies while DVS Raju the chairman of VisualSoft has resigned.
According to V Krishnan, the chief financial officer of VisualSoft, "The merger will benefit all the companies. We would be able to provide technology solutions, testing and enterprise services. The combined entity would be able to notch up upwards of $40 million in revenues."
On being questioned about the holding of each company is the combined entity he said, "The modalities are being worked out and we should be able to inform the public about the equity structure of the new company," he said.
DVS Raju had resigned to concentrate on the Gangavaram port project.
AppLabs had a turnover of $22 million (about Rs100 crore) and eSolutions is a software company based in Chennai with revenues of $1.2 million.
VisualSoft declared a total income of Rs54.13 crore and a net profit of Rs6.10 crore during the quarter ended September 30, 2005 as against total income of Rs47.14 crore and a net profit of Rs6.52 crore for the corresponding quarter last year.
Last year VisualSoft had revenues of Rs192.87 crore and a net profit of Rs28.33 crore.
A Softbank company and Srini Raju had picked up about 20 per cent stake in the company from its core promoters.
Last year Applabs received funding to the tune of $7 million from Westbridge Capital Partners.