Hyderabad, Oct. 28
THE merger of VisualSoft Technologies Ltd, AppLabs Technologies and eSolutions is likely to be completed by the fiscal-end and the combined entity of VisualSoft, which will be the flagship company, is likely to notch up revenues of about $70 million (approximately Rs 315 crore).
However, with the coming together of these three companies functioning in distinct business areas, such as IT services, software products testing and Web technologies, the company is set for restructuring. Addressing a press conference here today, the Chief Executive Officer of AppLabs, Mr Sashi Reddi, who has been chosen VisualSoft CEO, said the combined entity would swiftly enter the mid-tier IT company category and expected to notch up total revenues of about $100 million in the next financial year.
Giving details of the merger, the Chief Financial Officer of VisualSoft, Mr V. Krishnan, said the due diligence process had been initiated and the share swap issue will be announced within a fortnight. Given the regulatory issues that need to be addressed and clearance from the high courts of Andhra Pradesh and Tamil Nadu, the process would be concluded by March 2006 and results for about five months would be combined.
Referring to the business process outsourcing arm of VisualSoft, Mr Krishnan said with the shift in approach from IT services to IT product development, the BPO arm will refocus on high-end tech support work rather than provide call centre services.
"While the company would have about 1,800 employees, there would not be any downsizing. In fact, we would look at further expanding operations," Mr Reddi said. The Chief Executive of eSolutions, a company of iLabs, Mr Suresh Ramani, said the company's Web enabling platform would enable VisualSoft to address enterprise supply chain business.
Mr Reddi said with complementary resources and infrastructure, the new company VisualSoft would have the reach and scale to provide end-to-end services right from product development, testing and support.
The company's scrip ended the day lower at Rs 176.65 as against previous day's close of Rs 185 on the NSE.