TCS forms JV in China; to rope in Microsoft later
24 Jul 2006
Mumbai: Tata Consultancy Services (TCS), Asia''s leading software firm, has teamed up with three Chinese firms to set up a software joint venture in China. TCS will invest $15 million (nearly Rs 70 crore) in the joint venture.
TCS subsidiary, Tata Consultancy Services Asia Pacific, will hold 72.22 per cent in the joint venture while the three Chinese firms - Beijing Zhongguancun Software Park Development, Uniware and Tianjin Huayuan Software Area construction and Development - will participate as strategic investors, holding 27.8 per cent share, TCS informed the BSE in a release.
Once the venture is established, both partners will offload an equal number of shares to give a 10 per cent stake to Microsoft Corporation.
The new company, Tata Consultancy Services (China) is expected to start operation in September this year. The joint venture firm, to be located in Beijing''s Zhongguancn Software Park, will provide IT services and solutions to clients in the global as well as the Chinese market.
"This venture is a significant business opportunity, which is China-centric from a resource perspective, has global appeal in terms of its customer offerings and is capable of creating a Chinese domestic business of increasing scale. TCS will help develop best-in-class core competencies in software engineering, processes, scalable software development by using our unique and world-renowned learning and development model that will create new opportunities for IT professionals and the industry in China," S Ramadorai, CEO and MD of TCS, said.
The joint venture will leverage the complimentary strengths of the different partners in technology, software development management, talent acquisition and training, including the global scale processes and practices of TCS It will also leverage experience and resources of the Chinese partners, which run the national software development parks. The jont venture has been initiated and supported by NDRC, with the objective of supporting China''s local software industry through international cooperation.
