HCL TECH INKS
JV DEAL WITH JAPAN'S NEC CORP
JAPANESE high end computing major NEC Corporation
and India's IT major, HCL Technologies announced a joint venture
for software development in India for Japanese companies.
The joint venture company will provide offshore
solutions in embedded software, hardware design, network and
security and mobile technology to NEC and its Japanese clients.
Besides, it would also conduct research and development (R&D)
in grid computing for NEC, its subsidiaries and their clients
in Japan and worldwide.
“The new entity is the first joint development
base in India by NEC and is strategically positioned to enable
NEC and HCL to explore business in areas not covered in the
current focus of joint venture,” NEC Corp Executive Vice-President
and President of NEC System Toshihiko Takahashi said. Commenting
on the agreement, HCL Tech's Shiv Nadar said, “The arrangement
is the first of its kind where a Japanese technology giant
and one of the largest Indian IT firms have formed a JV focused
on Japan business.” He expects the agreement to give a big
boost to India's software exports to Japan.
NEC will hold a majority stake of 51% in the
company and Shiv Nadar controlled HCL will held the rest.
According to Mr Nadar, the venture that would be based at
Noida, is expected to generate annual revenue of $25 million
in three years that will increase to $100 million within five
year.
The JV would have a paidup capital of $5 million
or around Rs 22 crore. The new company would be incorporated
by August and start functioning by October. The JV would employ
70 professionals by the end of this year and 250 in three
years. HCL would provide the CEO and the CTO along with some
key technical people to kick start the JV.
Takahashi said their agreements with other
Indian companies regarding software development would continue
in the present form but NEC would like to expand its relationship
with HCL further. Nadar said the CEO and CTO would be named
shortly. An advisory committee with representation from the
top management of each partner would be formed to set up the
future direction of the joint venture company.
