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Locuz and Choice Solutions to merge

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CIOL Bureau
New Update

HYDERABAD, INDIA: Privately held Locuz Enterprise Solutions Ltd. and Choice Solutions Ltd. announced today that the companies will be entering into a definitive agreement to merge in an all-stock transaction.

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Under the agreement, which is yet to secure the approval of Indian regulatory authorities, Locuz stock will be converted into Choice stock at a fixed exchange ratio of 2 shares of Choice common stock for each outstanding share of Locuz common stock.

The combined company will operate under the name of Locuz-Choice Solutions Ltd. K V Jagannath, present Managing Director and CEO of Choice Solutions will continue as Managing Director and CEO of the combined entity. Vijay K Wadhi, President of Locuz Enterprise Solutions, will be the Joint Managing Director. The board of directors of the combined company will be reconstituted to include equal number of members from the current boards of Locuz and Choice.

Locuz Enterprise Solutions since its inception in 2000 has been a specialist in IT Infrastructure solutions with acknowledged expertise in High Performance Computing, IT Security and IP Convergence solutions. Over the last 2 years, Locuz has also forayed into the Enterprise IT Management space by establishing a NOC/SOC in Hyderabad and has been providing SLA-driven On-site/Off-site services to clients in India and abroad in the area of Network and Systems Management, Managed Security and IT Governance.

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Choice Solutions is an end-to-end IT solutions provider enabling the holistic IT environment for customers and is rated among the top IT companies in India. Since inception in 1991, Choice has established a pan-India and U.S. presence, a customer base, partnerships with technology leaders and a niche for itself in providing complete data center lifecycle solutions and services. In the past few years, Choice also developed strong practices in the areas of Enterprise Software Licensing, Offshore Software Development, Enterprise Storage, DR/BCP, Managed Services and Audits.

"Both Choice and Locuz are on course to become leading technology companies in the country by 2010. With growing complexity in IT environments, our customers are seeking a strategic partner that will fulfill their ongoing IT needs in the long run. This merger is a natural, accelerated progression towards our mutual goals and total customer satisfaction,“ said K V Jagannath, Managing Director, Choice Solutions.

The aggregate revenue of the combined company is expected to be approximately Rs 150-170 Crore for the fiscal, which begins in April 2007 and ends in March 2008. It is expected that 75 percent revenue of the combined company will come from the Enterprise Solutions business and the remaining from IT Services. The employee strength will exceed 550.

The merger is expected to close in the first quarter of 2008 and is subject to customary closing conditions, including approval by the shareholders of both companies and regulatory approvals.

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