• PAGE ONE
• INDEX
• HOME

DSQ Soft acquires US co for $30 m

Our Bureau

CHENNAI, July 10

DSQ Software Ltd on Monday announced the acquisition of the US-based San Vision Technology Inc (SVT) for $30 millions in an all-stock deal. The board of directors of DSQ Soft also gave its in-principle approval for another acquisition in the US.

Mr. Pawan Kumar, Chief Executive Officer (CEO) and President, DSQ Soft, said that SVT was engaged in rendering professional services in the fields of banking, financial services and insurance.

The equity dilution would be only 3.5 per cent, he added. Post-acquisition, the paid-up share capital of DSQ Soft would increase from Rs. 33 crores to Rs. 34 crores.

SVT was promoted by Mr. Sanjay Sethi and had revenues in excess of $15 millions in 1999 and for the current year, the budget is set at $25 millions.

The company is debt-free and `clear receivables' and cash at bank alone stand at $8 millions. The company has a development centre in New York and employs 160 people.

SVT recorded a net profit of $4 millions in 1999 and hopes to achieve a net profit this year of $7 millions.

Mr. Pawan Kumar, however, refused to divulge the details of the second company for which the board gave an in-principle approval today.

``All I can say is that the size of the this company is similar to that of San Vision and they specialise in telecom networking, supply chain management and some products on the ERP side,'' he said.

Mr. Dinesh Dalmia, Vice-Chairman of DSQ Soft, said that the second acquisition would be completed in two weeks. He added that DSQ would go in for specific approvals from shareholders for the acquisition. ``Ideally we would like to go to the shareholders completing both acquisitions.''

SVT was incorporated in 1992 and its clients include AIG, JP Morgan, Merrill Lynch, Deutche Bank and AT&T. The company is a tier-1 supplier for AIG. The average realisation of SVT is $85 per hour as against DSQ's $60 per hour.

The legal and other regulatory aspects of the first acquisition is expected to be complete in six weeks and the long term plan of DSQ Soft would be to merge SVT with it.

Under the terms of the deal, all employees of SVT would be entitled to stock options of DSQ Soft as they automatically become a part of it by virtue of this acquisition, Mr. Pawan Kumar said.

The board of directors of DSQ Soft would meet on July 27 to consider the financial results for the quarter ended June 30.