Mindteck acquires US firm for $21 mn

Bangalore, Feb 6 (UNI) IT Major Mindteck has acquired US-based Infotech Consulting, a multi-disciplined technology services firm, for 21 million US Dollar, Company CEO Pankaj Agarwal said today.

Addressing newspersons here, he said Infotech Consulting had large commercial and governmental customer base and significant expertise in business application consulting.

The acquisition, the first in the series of four planned for before march 2008, would set Mindteck's 'go global' growth strategy in motion.

With an estimated revenue of 31 million USD and over 250 employees, the acquisition would help Mindteck further solidify its market position.

''On a stand-alone basis for FYE March 2008, consolidated revenue of Mindteck and its four acquisitions have been estimated to be over 75 million USD,'' he added.

The company raised 7.23 million USD through private equity for implementation of its 'go global' strategy and clear some debt besides funding current acquisitions and future growth.

Mindteck has issued shares to new private equity investors at Rs 73.54 a share, a premium of Rs 52.54, apart from issuing additional stock for acquisition of Infotech Consulting at Rs 98.50 per share, on a stock swap basis, he added.

Elaborating on the company's 'go global' strategy, Mr Agarwal said it included building a multicultural global organisation by strengthening Mindteck business in the US and expanding operations in Europe and Asia.

It also envisaged acquiring new clients and adding new service offerings in high growth areas besides reducing dependency on the us for business by spreading its wings in Europe and the Far East.

Mitigating the risk of slowdown in American economy and the dollar depreciation also formed part of the strategy.

Once the acquisitions were complete, the share of US in Mindteck's business will come down from the present 95 per cent to 85 per cent, Mr Agarwal said.

Establishment of operations in Netherlands and Germany, opening new offices in South Carolina and exploring acquisition of a firm in China were also on the cards.

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