Bangalore-based IT services firm MindTree Ltd has said it will acquire the Indian subsidiary of US-based Kyocera Wireless Corporation. MindTree will pay an upfront amount of $6 million besides revenue-linked payments during the financial years 2010-11 and 2011-12 for the purchase of Kyocera's India captive unit.
The acquisition will allow MindTree to offer end-to-end design and technology services to wireless original equipment manufacturers and service providers. For Kyocera, selling off its captive will help it improve cost structures and competitiveness.
Kyocera Wireles has 600 employees in its India office, which will continue to service the parent company on a contract basis, following the sale. Kyocera's India development centre is engaged in wireless product development, software engineering and product testing for KWC’s global portfolio.
MindTree said, the acquisition will contribute around $9 million in revenues for the period October 2009 to March 2010, with PAT expected to be in the range of 13-15%.
Janakiraman S, president and group CEO, MindTree, said, in a statement, “the acquisition makes Kyocera a major strategic client for MindTree.”
Lat week, VCCircle reported that private equity firm SAIF Partners had exited from MindTree with over 2x returns. SAIF has completed the exit in MindTree selling a major chunk of its holding for about $20 million (Rs 96 crore). SAIF picked up 4.97% stake in MindTree for around $12 million (Rs 57.6 crore) in late 2008 to early 2009.