Mumbai: L&T Infotech Ltd, the unlisted information technology (IT) services arm of engineering and construction company Larsen and Toubro Ltd (L&T), plans to make acquisitions and enter newer markets in an attempt to double revenue by 2015, company executives said on Monday. Meanwhile, it has put plans for a stock exchange listing on hold.

“We are about a billion dollars in size and our objective is to double our revenue in the next two years. We have the brand and customers who believe in us in place. All we now need is to invest in sales and marketing," said Vivek Chopra, chief executive (industrial cluster), in an interview.

The company is already working with a clutch of investment bankers to assist in potential acquisitions.

Avinash Lele, head of strategy and mergers and acquisitions (M&As), said the company will look at acquisitions that “will give us an undisputed leadership stamp, be it in a vertical, geography or platform".

L&T Infotech has had a series of failed acquisition attempts in the past.

The company had bid unsuccessfully for Satyam Computer Services Ltd (now merged with Tech Mahindra Ltd), Patni Computer Systems (acquired by iGate Ltd) and Hexaware Technologies Ltd (bought by Baring Private Equity Asia) in the past.

More recently, the company was in the news as a potential bidder for Hewlett-Packard Co.’s stake in Mphasis Ltd and Polaris Financial Technology Ltd’s IT services unit—both dismissed as speculation by the respective companies.

Asked about the failed acquisition efforts, Chopra said: “Acquisitions are not just to add revenue; our intention is not one plus one makes two. What’s important is that it should be a cultural fit, as acquisitions do fail."

L&T Infotech wants to acquire a company that would help it enter a new geography or a new vertical.

“In a recession, people spend more money on acquisitions, but not huge chunks. The focus is on smaller chunks, to move up the value chain and provide your customers a better service," said Sanjoy Sen, a senior director at consulting firm Deloitte Touche Tohmatsu India Pvt. Ltd.

Currently, 70% of the company’s revenue comes from the US, 25% from Europe, and the remaining from the rest of the world, said Chopra, adding that “after de-risking, we are looking at 50% US and 50% outside of the US".

Chopra added that the company sees promise in continental Europe.

“Going forward, in the next three years, we expect a lot of business coming from there considering the economic scenario in Europe. They have no option but to outsource, as they are competing with American companies," he said.

Mukesh Aghi, chief executive (services), said L&T Infotech has hired over 100 sales leaders and country managers across geographies, and stepped up efforts in South Africa, the Middle East and France, “where we believe we will get returns". “This will be done by doing the right acquisitions, which will complement and provide value to what do and believe in".

Pradeep Udhas, a partner at the Indian unit of KPMG, said L&T Infotech has “to scale up to $2-3 billion revenue mark across various industries segments and broad geographies in order to compete with competitive landscape of IT and engineering services".

L&T Infotech has put its plan to seek a stock exchange listing on hold. Aghi said: “We want to focus on building the company first. (On listing) we will talk in three years."

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