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KPIT Cummins buys 50% in Systime for Rs 103 crore

KPIT Cummins buys 50% in Systime for Rs 103 crore
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First Published: Tue, May 24 2011. 04 23 PM IST
Updated: Tue, May 24 2011. 04 23 PM IST
Mumbai: KPIT Cummins Infosystems Ltd said it has bought a 50% stake in Systime, a business technology service provider, for Rs 103 crore, to expand its Oracle-based consulting and services business.
The Pune-based IT firm said it will buy the remaining 50% of equity and preference shares over three years.
“From KPIT’s perspective, the deal gives us a presence in Brazil and a much larger presence in the Oracle world, especially in the manufacturing and the energy and utilities vertical,” chief executive Kishor Patil told reporters on a conference call.
Mumbai-based Systime has presence in 77 countries, including Brazil, which accounts for about 10% of the firm’s revenue.
Systime, a unit of the CMS group, provides Oracle’s JD Edwards enterprise solution to its clients. Oracle’s JD Edwards solution is a suite of enterprise resource planning software that provides ease in administration and saves costs.
After the deal, the combined Oracle practice of the company will be worth more than $125 million for FY12, KPIT said in a statement.
In Januaruy, Anil Patwardhan, vice-president of finance at KPIT, had told Reuters the company is scouting for acquisitions of about $20 million to $25 million in the areas of automotive electronics and enterprise resource planning.
The company had acquired US-based CPG Solutions and Germany-based In2Soft Gmbh in FY11.
The deal, which was funded via internal accruals, will start adding to KPIT’s revenue from October and will contribute $68 million in the first year, Patil said.
Avendus Capital were the advisors on this transaction, KPIT said.
Shares of KPIT, which the market values at $376.94 million, rose as much as 5%, but pared its gains to close flat at Rs 163.70 in a firm Mumbai market.
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First Published: Tue, May 24 2011. 04 23 PM IST
More Topics: KPIT | Cummins | Systime | Oracle | IT |