California Software Company Ltd, an offshore software product development company outsourcing enterprise software solutions, is looking at divesting its labs business (product engineering services) to Alten Europe. for a consideration of up to Rs 100 crore. The company’s labs undertaking includes investments in India and the US and business units in Chennai and Bangalore.
California Software has entered into Letter of Intent (LOI) with Alten Europe to sell the labs business for a consideration not below Rs 100 crore, it said in its filing with the BSE. The transaction is subject to necessary regulatory approvals and definitive structure to be agreed between the parties. The divestment of the Labs business will facilitate the company to focus and expand on its enterprise solutions and strategic investment divisions, it said in a release.
The company is taking approval of the shareholders under section 293(1)(a) and 192A of the Companies Act for disposal/sale of labs business through postal ballot.
For the quarter ended on June 30, 2010, the company’s net sales was Rs 45.76 crore against Rs 72.93 crore for the quarter ended on 30-June-2009. The net loss was at Rs 4.42 crore for the quarter ended on June 30, 2010.