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Avantel to go public

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CIOL Bureau
New Update

HYDERABAD: Avantel Softech Ltd, a Hyderabad-based technology company

primarily into communications products and services, has announced its plans for

going global and further expansion. The company, which had started off as a

manufacturer of communications products--microwave, radio, network access, and

satcom--entered the software consultancy and products area to leverage its

inherent strength of development and design and the emerging opportunity in ERP,

Internet and Web-enabled solutions, and systems integration.

Among its ambitious plans include setting up of a software development center

in Hyderabad, a wholly-owned subsidiary Avantel Softech Inc in the US, and

expand its existing infrastructure. As part of that strategy, the company

estimates the total project cost to be in the tune of Rs 10 crore and intends to

raise the sum through an Initial Public Offering (IPO), term loans, and internal

funds. In February, it plans to go for a public issue comprising 1,338,500

shares of Rs 10 each at a premium of Rs 40 to raise Rs 6.69 crore. While about

Rs 2.5 crore will be raised as term loan from Canara Bank, the rest would come

from the promoters and friends' share. Out of the total sum of Rs 10 crore that

would be raised, about Rs 3 crore would be invested on infrastructure. The lead

managers for the issue are Canara Bank and Jardine Fleming India Securities.

Avantel, which had revenues aggregating over Rs 8 crore as on 31 March 1999,

has built its core competency in the communication field and subsequently

ventured into software products and services seeking to consolidate its strength

in communication systems and management practices. It has also successfully

developed network management software for the HDSL equipment, and has also

developed an integrated ERP package (under the name "Funwork") for

small and medium enterprises. It is now in the process of developing embedded

software for a variety of real time applications on a number of platforms.

Avantel's focus is to become an integrated solutions provider addressing the

convergence of technologies in data communications, conventional voice networks,

and computing.

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