The Hindu Business Line : Mastek eyes US buys in insurance, Govt verticals

Mumbai March 30 Mastek Ltd, a Mumbai-based software services company, is sewing up plans for acquiring IT companies in the US, in the specific verticals of insurance and Government.

"We are eyeing acquisitions in the range of $10-15 million (Rs 45-67.5 crore) in the Government and insurance service verticals," said Mr Jamshed B. Jussawalla, CFO.

The acquisitions will be in line with Mastek's strategy to enlarge the US component of its revenues.

The company is aiming at 35 per cent of revenues coming from its US business, up from 20 per cent currently, said Mr Jussawalla.

Mastek is working on a large number of UK Government assignments.The company is now looking at expanding its footprint in the US by bagging Government projects.

"The US regulatory norms demand that a company must have a proven track record in doing projects for the US Government; an acquisition in this market will meet that condition," he added.

Mastek currently does insurance assignments for its customers in the US, but not on its trademark Elixir platform.

"Owing to strong domestic competitors, the entry barrier in the US insurance market is very strong; having a US-based insurance services company will help us reach the available clientele," Mr Jussawalla said.

Mastek might freeze at least one acquisition before the end of the current calendar year, he added.

The company has also decided to set up its second software development centre in Mahape near Mumbai.

This centre - on which work has started - will cover an area of 93,000 sq ft and have a capacity to house over 1,500 professionals.

"We are spending about Rs 80 crore from internal accruals. The centre would be ready in phases (latest by December 2007) and would be integrated with the existing development centre."

The centre will focus on the insurance, Government and financial verticals for its existing and future clients, Mr Jussawalla added.