The Hindu Business Line : Mastek acquires US-based STG for $29 million

MUMBAI: Software solutions company Mastek said on Monday that it would acquire US-based Systems Task Group (STG) International Ltd for $29 million (about Rs 118 crore). Mastek, through its wholly owned US subsidiary MajescoMastek, would acquire STG Inter national in an all-cash transaction for $US 29 million, Mastek said in a communique to the Bombay Stock Exchange.

Systems Task Group (STG) International Ltd is an IP-based enterprise solutions provider to the North American property and casualty (P&C) insurance industry. The buyout is being funded through internal accruals and bank borrowings with 85 per cent of the total consideration payable instantly, the company said.

Consequent to the buyout, STG would be known as STGMastek. The integration process of STGMastek with Mastek's existing operation would be over by June 2008 and STG's contribution would be reflected in Masteks consolidated performance partly in FY'07-08 a nd fully in FY'08-09, it said.

"This acquisition is another important step in furthering our strategy to expand our presence in both the life and non-life segments of the high opportunity US insurance market," said Mastek Chairman and MD Mr Sudhakar Ram.

Further, Mr William McCareter, would be taking over as President of STGMastek. Mr McCarter had joined Mastek last year as head of its US operations and has over two decades of experience in the North American P&C insurance industry, the filing added. Las t year the company had acquired US-based Vector Insurance Services for about $9 million. In afternoon trade, shares of the company were trading at Rs 254.50, down 2.43 per cent on the BSE. - PTI

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