Hexaware completes successful closing of acquisition of FocusFrame

Hexaware Technologies Ltd on December 05, 2006 has announced that it has successfully completed the acquisition of FocusFrame Inc, US based firm specializing in automated testing of ERP and custom applications. FocusFrame's business revolves around systems verification, Quality Strategy and IT Governance solutions, and various functional, performance, and system stress verification exercises.

The addition of FocusFrame is the Company's ongoing strategy to strengthen its Testing Service Practice, which is the fastest growing service. The Company and FocusFrame together will reinforce their expertise in Independent Testing and Verification services, which is amongst the fastest growing business opportunities for offshore vendors.

Originally announced on November 06, 2006, under a definitive agreement, FocusFrame Inc. was acquired in an all cash deal for $34.3 mn. With the closing of this acquisition, FocusFrame Inc becomes a wholly owned subsidiary of the Company. Taking a step ahead, the integration of FocusFrame's operations & business with the Company begins. FocusFrame's Mexico center is scaling up as the Company's sixth full fledged global delivery center.

Commenting on the transaction, Mr. Atul Nishar, Executive Chairman of the Company said, "We are very excited with the acquisition. Hexaware will now be in a position to offer complete lifecycle of Testing service and would be able to achieve more than US $100 mn revenue from this practice in the next three years."

As per the terms of the Agreement, the Company paid US$ 25 mn in cash towards acquisition of 100% shares of FocusFrame along with its employees and consultant base of over 200 personnel. The balance amount of US$ 9.3 mn being paid out over 24 months contingent on achieving the projected revenue and margin targets. FocusFrame co-founders -Vaughn Paladin and Suri Chawla - will continue to run the operations as a fully owned subsidiary of the Company.

FocusFrame Inc is expected to raise the strength of the Company's Testing Practice Consultants to 600. FocusFrame has 9 Fortune 500 Companies and 7 'million dollar' Companies in its existing client list. Since the acquisition closed in November 2006, the December revenues for FocusFrame will be added in the Company's revenue for the quarter ending December 31, 2006.

Source : Equity Bulls

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