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Mr Shiv Nadar (right), Chairman & CEO, HCL Tech, and Mr Toshihiko Takahashi, President, NEC System Technologies, at a press conference in the Capital on Friday. - - Kamal Narang

New Delhi , June 3

HCL Technologies Ltd and NEC Corp, Japan on Friday announced setting up a joint venture to provide advanced software engineering solutions for NEC and its clients globally.

The joint venture would have a capital of $5 million. NEC and its subsidiary NEC System Technologies would hold the majority stake of 51 per cent, while HCL would hold 49 per cent.

"The joint venture company will provide offshore solutions in embedded software, hardware design, network and security, systems integration, R&D, high performance computing and mobile technology to NEC and its subsidiary for their clients worldwide," the NEC Corp Executive Vice-President and President of NEC System, Mr Toshihiko Takahashi, said.

The new entity is the first joint development base in India by NEC and is strategically positioned to enable both to explore business in areas not covered in the current focus of the joint venture, he added.

The joint venture would be incorporated by August and start functioning by October, said Mr Takahashi. The joint venture, to be based out of Noida, would employ 70 professionals by the end of this year and 250 in three years.

The CEO and the CTO will be from the HCL side along with some key technical people to begin the joint venture.

The joint venture is expected to generate $25 million in three years and has a potential to scale up to $75-100 million revenue per annum in a five-year period, the HCL Tech CEO and Chairman, Mr Shiv Nadar, told reporters. He added that 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.

Mr Takahashi said NEC's agreements with other Indian companies regarding software development would continue in the present form but the company would like to expand its relationship with HCL further.

The intellectual property of software products developed by the joint venture would be owned by NEC, Mr Nadar said when asked.

The arrangement is the first of its kind where a Japanese technology giant and one of the largest Indian IT firms have formed a joint venture focused on Japan business, Mr Nadar said. "It is a matter of pride for us to work together as partners with NEC ," he added.

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