Mumbai:Leading IT services provider in the small and medium sized business (SMB) segment Omnitech Infosolutions said on Thursday it has taken over Avensus Netherland BV for around Rs 45 crore in an all cash deal and hopes to close the acquisition by the first week of February.
“We have acquired a 100 per cent stake in Avensus for $ 9 million in an all-cash deal. We have made an upfront payment of $4.8 million and the remaining amount will paid over a period of three years. We hope to close the deal by the first week of February,” Omnitech managing director and chief executive Atul Hemani said
The deal will help Omnitech get an access to over 100 existing customers of the Dutch firm , explore cross-selling of its services such as remote infrastructure management, application management, business continuity and domain services.
Avensus offers managed IT services such as security, storage and virtualisation solutions to banking and financial services institutions , healthcare and government sectors.
The acquisition will also help the Mumbai-based firm gain new customers by leveraging its global delivery model to offer competitive services to European customers thereby increasing the overall profitability.
Currently, Omnitech’s earnings from the European market is around 8 %, which is expected to grow two-three times to around $ 40 million by the end of FY14, Hemani said, adding with the acquisition of Avensus, the company hopes to add around $3 million to the revenues by end of this fiscal.
This is Omnitech’s first overseas acquisition and is financed through 80 % debt and 20 %internal accruals.
Hemani further said the acquisition will help Omnitech strengthen its presence in the European market and will provide a platform to leverage local strengths combined with the firm’s global delivery model in various services.
The BSE-listed mid-cap firm is also eyeing a five-fold topline growth to Rs 1,000 crore by FY13. It had reported a revenue of Rs 216 crore in FY10 and expects a 30 % growth this fiscal, which will be driven by this acquisition.
Hemani further said, the company will be expanding its workforce from current 1,100 to 2000 by the end of this fiscal.