The Hindu Business Line : Teledata sets aside Rs 180 cr to buy US-based cos

CHENNAI-BASED Teledata Informatics Ltd has set aside Rs 180 crore ($40 million) to acquire three US-based companies during the current financial year. Two of these acquisitions are slated to get over by June this year.

The acquisitions will be financed by funds raised through a recent tranche of GDRs. Teledata, having raised Rs 37 crore through its maiden GDR in August 2004, closed its second tranche of GDR earlier this month. In this offering, Teledata placed 49,91,000 GDRs at $11 each, mopping up $54.9 million (around Rs 247 crore), thus allowing the company to set aside nearly $15 million for future acquisitions.

The GDR allotment was approved at a board meeting on April 5. Clearly, the company has strategically opted for the inorganic mode of growth, having four offshore businesses last year - Bitech International, Dubai, Bitech International, Singapore, Insoft Systems, Singapore and Transworld Information, US. Teledata had invested an aggregate of Rs 54 crore for these acquisitions and some ongoing SAP implementation businesses.

Talking to Business Line, Mr K. Padmanabhan, Director, TIL, said, "We have shortlisted three US-based ERP solutions companies for acquisition during this financial year. Of this, two acquisitions should be taking place during the current quarter."

The cash-rich company closed the last quarter of 2004-05 with net sales of Rs 145 crore as against Rs 14 crore a year ago. The net profit during the quarter was Rs 37 crore, a massive jump from Rs six crore in the fourth quarter of 2003-04. The company's net sales in 2004-05 stood at Rs 348 crore as against Rs 57 crore in the previous year.

"We have set ourselves a target of Rs 1,000 crore for the current fiscal and are confident of exceeding this. Education products will account for 60 per cent of this, overseas sales will bring in Rs 500 crore and domestic sales Rs 100 crore. Its marine business where the company is among the top three players the world over will account for 30 per cent while our utilities business will bring in 10 per cent," Mr Padmanabhan said.

It was a few days back that Teledata announced bagging a $12 million order from Bunge SA of Switzerland. The order for ERP solutions that forms part of Teledata's utilities portfolio is to be implemented by March 2006.

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