Wipro Infotech acquires 3D Networks

Wipro Ltd has announced that Wipro Infotech, the India, Middle East and Asia Pacific IT Business Unit of the Company, announced it has signed an agreement to acquire India, Middle East and SAARC operations of 3D Networks and Planet PSG in an all cash deal. The consideration includes an upfront cash payment of approximately USD 23 Mn on closure of the transaction and additional performance linked payments based on achieving agreed financial targets over a two year period.

3D Networks, a Platinum partner of Nortel Networks, provides business communication solutions that include Consulting, Voice, Data and Converged Solutions, and Managed Services. The Company’s specialized solutions are deployed in ITES/IT, Telecom, Banking and Finance, Government and Service verticals.

In India, 3D Networks has a dominant presence in providing business communication solutions to ITES/IT segments and has approximately 270 employees serving several marquee customers. During FY 2005-06, the company clocked revenues of approximately USD 36 Mn, a growth of 39% YoY. A profitable entity, it commenced India operations in 2001.

Planet PSG is the sole Global Nortel Technical Services partner on Periphonics platform in APAC region and provides professional services on voice and speech platforms in the region.

Mr. Suresh Vaswani, president, Wipro Infotech and President- Global IT Service Lines, Wipro Technologies said "India’s emergence as the outsourcing hub for global majors is fuelling demand for Convergence Solutions. 3D Networks strong integration skills in convergence technologies, customer base and proven track record complements and enhances our existing comprehensive IT Solutions and Services. Customers will immensely benefit from our broad suite of offerings in converged space. Our acquisition strategy here was to add new practice competencies and enhance our broad suite of service and solutions portfolio".

The closing of the transaction is subject to customary closing conditions and regulatory approvals; the acquisition is expected to be completed by Q3 of FY 2006-07.

MAPE Advisory Group acted as the financial advisor to Wipro on this transaction.

Source : Equity Bulls

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