THE Chennai-based Kaashyap Technologies (KTL), formerly Kaashyap
Radiant Systems, has acquired the consultancy division of the New
Jersey-based Logistics Solutions for $8.5 million in an all-cash deal.
The move is in line with its new strategy to give a thrust to its operations. While it was initially providing high-end education courses like Java and Corba, besides e-commerce, it would now offer SAP services, consulting and high-end training, KTL officials said.
â€œSince 1997, when it was incorporated, KTL was doing extremely well focusing on educational segment. However, after the 9/11 epi-sode, the company found itself with very less work. The acquisition of the consultancy division of Logistics Solutions is a first step towards providing a new thrust,â€ Mr. A Venkatramani, chairman, KTL told a press conference.
Logistics Solutions is said to serve a wide range of clients across sectors and clocked a turnover of $13.5 million in the calendar year 2006. â€œTypically, about 60% of such a companyâ€™s revenues come from the consulting division. And thatâ€™s why we have first acquired it,â€ Mr. Venkatramani said.
KTL, he said, has raised $8.5 million through a GDR issue to fund the acquisition and initially $2 million has been paid in advance. KTL will be raising an additional $8.5 million through another GDR issues, besides hoping to raise Rs 50 crore through a rights cum public issue here in the domestic market.
Following the 9/11 disaster, KTL found it hard to sustain the opera-tions and to retain the employees. â€œHence, it went into red. While we have written off around Rs 120 crore over the past few years, KTL clocked a turnover of Rs 2.2 crore in 2006-07 and is now on its way to earn profits on a sustained basis,â€ Mr. Venkatramani said, while adding, â€œtogether with Logistics Solutions, KTLâ€™s turnover this year will touch $20 millionâ€.
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