BOSTON: The announcement to financial analysts by Keane Inc. president, on
Tuesday, that the firm was actively looking at making acquisitions, has
confounded speculation that the Boston-based IT firm has been the takeover
target for India tech giant Wipro Ltd.
"We're very focused on identifying accretive, critical mass
acquisitions," Keane president Brian Keane said during the firm's first
analysts' conference in two years.
Back in India, Wipro’s stock, has been witnessing an upward trend following
newspaper reports that it was close to snapping a deal with either Keane or
Sapient Corp., a Cambridge, Massachusetts-based Internet consulting company.
Keane compared the current business climate with the early 1990s when Keane
bought GE Consulting Services and Nynex's AGS Computers. Both acquisitions
dramatically increased Keane's size and added to its earnings immediately, he
said. However, Wipro, which has a market value of more than $8 billion, said it
has no agreement to acquire any US firm, but that it routinely discusses
potential acquisitions.
Keane did not name any potential acquisition targets, but did say, "We
are looking for the right kind of critical mass acquisition that can lay on top
of what we are. It could be anything from local, to regional, to national in
scale. We're talking with any number of firms out there."
But the one essential requirement for the company, which has a market cap of
$1.3 billion and at the end of the first quarter was debt-free with $145 million
in cash on hand, is that any acquisition be "immediately, decisively
accretive."
Keane generates more than half its revenues, which totaled $208 million for
the first quarter ending March 31, from application development and management
outsourcing services. Firm officials said during the conference call that 90 per
cent of their customers are repeat clients.
(C) Reuters Limited 2001.