Chennai:
The Chennai-based IT services company Helios & Matheson
Information Technology Limited has signed a $19-million
agreement to take over three companies of the Bangalore-based
vMoksha group comprising vMoksha Technologies Limited,
vMoksha Technologies Inc, USA and vMoksha Technolgies
Pte Ltd, Singapore. The transaction will be completed
in May 2005.
"With
this acquisition we would be able to strengthen our presence
in Europe," said GK Muralikrishna, managing director,
Helios & Matheson. vMoksha Technologies has 25 clients
and is strong in healthcare and banking, financial services
and insurance, while Helios & Matheson specialises
in Networking, software, internet and e-business services
and solutions.
.
The two-part purchase price consists of $17 million in
cash and $2 million based on targets achieved over a two
year period. PricewaterhouseCoopers (PwC) acted as advisors
to the transaction. According to the deal the three vMoksha
companies will continue functioning as they are now for
two years and may be merged with the Rs121-crore turnover
Helios & Matheson later.
The
$22-million vMoksha Technologies has 510 employees. vMoksha
was founded by Pawan Kumar, former president of IBM Global
Services in India. Kumar has agreed to continue as CEO
post acquisition. The company's top management comprises
a team that has held senior positions in TCS, IBM and
Fujitsu. "The merger with Helios & Matheson is
a perfect fit with our business strategy and our competencies,"
he says.
Explaining
the sale to Helios and Matheson, Kumar explained, "Size
is critical for IT services companies and with this marriage,
we can rapidly expand our client base and access bigger
opportunities, resulting in a win-win situation for all
stakeholders."
For
Helios and Matheson this is a second major acquisition
within a short period. Last September the company, in
a $7.5 million deal, bought two outfits Maruthi
Info Tech Inc, USA and Jayamaruthi Software Systems Private
Limited, Chennai. The two companies operate in the healthcare
and insurance sector.
The
14-year old Helios & Matheson, which has an uninterrupted
record of profits and dividend distribution since inception,
plans for
an aggressive growth to $100 million revenue through strong
organic growth complemented by a judicious and focused
acquisition strategy. The company is also planning to
attain a critical mass of 2000 employees by 2006.
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