Financial Daily from THE HINDU group of publications
Thursday, Apr 21, 2005
Financial Daily from THE HINDU group of publications Thursday, Apr 21, 2005 |
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Info-Tech
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Venture Capital Nokia arm picks up stake in Sasken Our Bureau
Mr Rajiv C. Mody, Chairman and CEO, Sasken Communication Technologies Ltd, at a press conference in Bangalore on Wednesday. - - G. R. N. Somashekar
Bangalore , April 20 NOKIA Growth Partners, the recently floated venture capital arm of mobile handset major Nokia, has picked up a small stake in Sasken Communication Technologies by investing $3 million (around Rs 13 crore). Nokia is one of the key customers of Sasken for which it develops software for handsets and networking equipment. Announcing Nokia's investment, the CEO of Sasken, Mr Rajiv C. Mody, said the company would utilise the funds to fuel its growth, especially the working capital requirements and pursuing mergers and acquisitions. Mr Mody did not disclose the extent of equity dilution but said Sasken planned to issue fresh equity to Nokia Growth Partners, which is focussed on funding global mid-to-late stage start-ups. Sasken has become the first Nokia Growth Partners portfolio company and the VC's first investment in the Indian telecom sector. Mr Mody said this investment would go a long way in entrenching Sasken's positioning as a leading global player in telecom products and services market. Nokia's investment in Sasken follows the recent funding it received from Nortel Networks, which invested $10 million in the Bangalore-based telecom R&D firm. Despite these investments, Sasken would come out with its initial public offering later this year to raise over Rs 100 crore, Mr Mody said. "We are on our path towards the listing process. We are definitely looking at listing the company by year-end. We are in the process of filing a red herring prospectus," he said. Intel Capital is the other investor in Sasken where promoters hold over 50 per cent stake. Sasken clocked a net profit of Rs 18 crore on revenues of Rs 166 crore in fiscal 2004. "We are seeing 30-35 per cent growth in revenues," Mr Mody said, adding, "net profits will stay ahead of topline growth."
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