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Silverline acquires SeraNova for $99m

Our Bureau

MUMBAI, Oct. 27

SOFTWARE firm Silverline Technologies Ltd has struck a deal to acquire Nasdaq-listed US company SeraNova Inc.

The two firms today announced a definitive agreement providing for the acquisition of SeraNova in an all-stock deal valued at about $ 99 million (about Rs 462 crore).

Under the terms of the transaction, approved by the boards of both companies, Silverline will acquire all of SeraNova's outstanding shares by way of issue of American Depository Receipts (ADRs). The swap ratio of SeraNova shares for Silverline ADRs has b een set at 0.35 (for 100 SeraNova shares, 35 Silverline ADRs would be issued). The two companies expect the deal to be completed by the beginning of next calendar.

The combination will create an entity with estimated revenue of over $ 175 million for the year ended June 2000.

According to a joint press statement issued by the two companies, the acquisition will enable the combined entity to offer a range of services in eBusiness, mobile and enterprise projects. The services range from strategy, design, implementation and leg acy transformation to ongoing application management and managed maintenance.

The statement said the two companies would bring synergies including complementary strategic partnerships and onshore/offshore delivery capabilities. The combination enhances Silverline's presence in North America, Europe and Asia/Pacific region.

``Silverline's expertise in legacy applications and SeraNova's eBusiness expertise enhances our ability to compete in the global market,'' Mr Shankar Iyer, President & CEO, Silverline Technologies, said.

SeraNova's Chairman, President & CEO, Mr Raj Koneru, said that the market is changing with renewed demand for full service vendors. ``By combining forces with Silverline, we will be able to offer expanded services to existing clients and offer broad-base d IT services to new clients, both onshore and offshore,'' Mr Koneru said.

Silverline shares ended Rs 3.28 higher at Rs 320.80 on the BSE on Friday.