The Hindu Business Line : Take Solutions, Four Soft plan merger

Chennai, March 28 The Chennai-based Take Solutions and Hyderabad-based Four Soft – both providers of software products and solutions in the Supply Chain Management space – plan to merge to create a large software product company.

Both the public listed companies have received “in principle” approval from their Boards of Directors to consider the merger. Both boards will appoint independent firms of chartered accountants and financial advisors to reach a fair valuation for the shareholders of both the companies.

The boards of the two companies expect to meet in 6-8 weeks to consider the reports of the advisors. The merger is subject to approval of the boards of the two companies, their shareholders, courts and other regulators, says a joint press release.

Once the merger is through, the final entity will be Take Solutions, the company’s Vice-Chairman and vision holder, Mr H.R. Srinivasan, told Business Line.

The coming together of the two first generation software companies will create a significant Intellectual Property company based out of India with global operations. Take Solutions’ strong presence in the US and Asia-Pacific complements Four Soft’s presence in Europe and Japan, he said.

Out of the $45 million turnover that Take Solutions reported for year ending March 2007, about 60 per cent came from the US and Asia Pacific. This year, the company with around 660 employees hopes to report revenues of around $75 million. Take solutions offers software solutions to large companies like Cisco, Parle and Brittania.

Four Soft’s turnover last year was $43 million last fiscal. With around 750 employees, it offers solutions to service providers like Emery and DHL, Mr Srinivasan said. “The merged entity will have a strong foothold in both enterprise and service provider segments,” he said.

Joint Venture

Take Solutions also announced that a joint venture agreement was entered into by the company’s overseas subsidiary, Towell Take Solutions, LLC, Muscat, for its proposed joint venture operations in Jabel Ali Free Zone Authority (JAFZA), Dubai.

Increase in shareholding

Further, the company plans to increase its stake to 100 per cent in two of its subsidiaries. It has 51 per cent stake in the overseas subsidiary Take United SDN BHD, Malaysia, and 58 per cent in the Indian subsidiary, Autoparts Asia, he said.

On the Bombay Stock Exchange, the share price of Take Solutions increased by 1.98 per cent to close at Rs 767.55. The Four Soft scrip rose 4.87 per cent and closed at Rs 25.85.

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