Infinite to acquire US-based VAS firm

NEW DELHI, INDIA: Infinite Computer Solutions is closing on a deal with a US company to acquire its product in the telecom value-added space.

The company is a provider of IT and ITeS solutions with a strong focus on telecom domain.

The deal is valued in the range of $10-15 million and will be the company’s second acquisition in the telecom domain following the takeover of Comnet in September 2007.

The company is also planning to raise Rs 200 crore through private equity or go for Initial Public Offering to fund the deal and its new initiatives.

Infinite Computer Solutions CEO Upinder Zutshi said the acquisition will be finalized in a week’s time and will further bolster the company’s footprint in the telecom domain.

Zutshi added that Infinite is also looking for an acquisition in the infrastructure management space in Europe, though the talks are at a very early stage.

For Infinite, which started as a pure IT services player in 2000, this acquisition strengthens its strategic focus in telecommunication solution-centric segments as the major and key vertical focus area.

While Comnet acquisition gave the company a doorway to target ISVs and equipment manufacturers in the US and Europe, this acquisition will give the company a headway in the transaction-based value-added services space.

Forty-five per cent of the total revenue, $85 million, registered by March 2008, were generated from telecom space.

Following the acquisition and organic drivers in place, the company expects to double its revenues from the telecom space by 2010.

“We expect 65 per cent of our revenues to come from telecom vertical by 2010. We also hope to double the revenues by that time,” added Zutshi.

The company will also actively pursue the inorganic route as part of its global expansion plans.

The company is also planning to expand its India operations.

The company has three development centers; each in Delhi, Chennai and Bangalore, and will be opening up another one at Noida or Gurgaon with an investment of $5-6 million.

Infinite has achieved sustained growth in revenues in recent years and had consolidated revenues of Rs. 3180 million (approximately $82 million) in fiscal 2007-08 from, a compound annual growth rate of more than 46 per cent from Rs 146.16 million in fiscal 2000-01.

The company also plays in healthcare and infrastructure management space and has clients like Verizon Communications, Oracle, AT&T and GE, Alcatel-Lucent, Tellabs and Sprint-Nextel among others.

Its employee strength increased from 190 in fiscal 2000-01 to 2000 in fiscal 2007-08.