Mindteck acquires US firm for $21 million

BANGALORE, INDIA: IT services company Mindteck India Limited today announced that it has completed the acquisition of US-based Infotech Consulting for $21 million, with $1.5 million in cash and the rest in stock.

The company announced the acquisition in July 2007. This is the first in the series of four planned acquisitions by Q4 of 2007-08 at a total cost of $30.6 million. The other three acquisitions being planned will be from the US, UK and Singapore.

Speaking to the media, Pankaj Agarwal, Mindteck Group CEO said that the acquisition will kick off its 'GO Global' growth strategy.

“The Infotech acquisition, which expands both our reach and service offerings, is a solid first step,” he said.

The company is planning to expand its European operation by adding offices in Germany and Netherlands this quarter. It is also exploring the possibility of an acquisition in China in FY 2008-09.

“We are well poised for steady organic growth and we will accelerate this with strategic acquisitions in the coming quarters,” he informed.

Currently, the company derives 90 per cent of its revenue from the US. With the US recession, the firm plans to expand its operations in Europe and Far East in order to mitigate risk.

Agarwal informed that that the company has raised $7.2 million through private equity for the implementation of its strategy. On a stand-alone basis, the consolidated revenue of Mindteck in FY 2008 and its four acquisitions is estimated to be over $75 million.

The company is also planning to establish office in South Carolina in Q1-08.

In India the firm has its offices in Bangalore and Kolkata. It will open new ones in Hyderabad and Gurgaon this quarter, added Agarwal.

Now Mindteck operates in four countries and plans to expand it to nine countries by the end of this fiscal year.

The company houses over 1000 employees globally with 350 employees in India.