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Our Bureau

Hyderabad, July 2 IT services provider SemanticSpace Technologies on Wednesday announced the acquisition of Prolifics, a US-based system integrator and a specialist in IBM technologies for $40 million in a cash-cum earn-out deal.

This involves upfront payment of $26 million in cash and the rest in the form of earn-out over two years.

With this acquisition, SemanticSpace, based in Hyderabad, would now have over 1,500 consultants, including 300 from Prolifics and is on course to a revenue rate of $100 million during the year, according to Mr Satya Bolli, its Chief Executive Officer.

Addressing a press conference here on Wednesday, Mr Satya Bolli said that along with Prolifics and another acquisition that the company made in Arsin Corporation, based in Santa Clara, the company would offer three broad areas of business covering system integration, testing and product development services.

Founded in 1997, SemanticSpace has investments from UTI Venture Fund and New Vernon, and has funded the acquisition of Prolifics through internal accruals and debt.

The Chief Executive Officer of Prolifics, Mr Nicolas Jabbour, said that the company has had over 1,200 projects and closed last financial year with revenues of $52 million. It operates out of New York and serves some of the firms on the Wall Street.

The cost of serving with operations and consultants in the US and Europe is high. With this merger, Prolifics now has access to resources in India that will make the cost of providing services lower. Likewise, SemanticSpace would have access to senior professionals in the US and Europe, Mr Satya Bolli said.

More Stories on : Mergers & Acquisitions | Overseas Investments | Software

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