Awaits High Court nod for merger with LGS Global

As it begins the process to integrate LGS Global into the group, Ybrant Digital is on the look out to buy a content firm, such as Lycos, which can attract Internet traffic.

“We are evaluating a few candidates for the acquisition. We will raise funds internally and from external sources. We are planning to grow organically and inorganically,” Mr Suresh Reddy, Chairman and Chief Executive Officer of Ybrant Digital, told Business Line.

Sources of funds

The nature of funds from external sources would include debt and equity.

Ybrant, which acquired seven firms so far in the last five years, raised about $100 million in equity and debt from private equity funds.

The digital advertising and marketing solutions company, which signed a deal with Hyderabad-based IT services firm LGS Global for merger, said it now awaited the go-ahead from the Andhra Pradesh High Court. “After getting the nod, we will go to the annual general body meeting to get the approval,” he said. The merger plan received in-principle approval from Bombay Stock Exchange and Madras Stock Exchange.

After the merger, the combined entity would be called Ybrant Digital. The share swap ratio was fixed 1:6 (one share of Ybrant for every six shares of LGS Global).

Pegging global digital media market size at $68 billion a year, Mr Suresh Reddy said that the market was expected to grow $100 billion by the year 2015.

Revenue target

The revenue of combined entity for the first half ended September 30, 2011, stood at $130 million with a profit of $25 million. For the full financial year, we are looking at a turnover of $300 million, with $100 million coming from LGS Global, he said.

(This article was published in the Business Line print edition dated November 25, 2011)
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