Bahrain's TAIB Bank has acquired 3.5% in Kavveri Telecom Products Ltd through open market operations for around Rs 4 crore ($0.9 million). Kavveri Telecom manufactures antennas and RF (Radio Frequency) products and has been fairly active in acquiring small overseas firms.
The company that was set up in 1991 had struck multiple deals in North America. Its acquisitions include Canada’s Trackcom Systems International that designs and develops for defence, electronic warfare and aerospace areas.
Kavveri had earlier acquired three other Canadian companies including antenna manufacturer- Til-Tek, DCI Canada, which operates in the area of RF products and filters and Spotwave Wireless Inc. Canada. Kavveri had also acquired the technology and IP rights of Sigma Wireless, Ireland from PCTel USA.
The promoters Shivkumar Reddy and RH Kasturi own just about 14% in Kavveri Telecom with other HNIs and corporate bodies holding the bulk of the equity stake.
For TAIB this is not the first IT related investment in India. It became the largest shareholder in another small cap IT firm Kaashyap Technologies, when the GDRs converted into equity shares in December 2009 representing as much as 32.37% stake.
Thereafter TAIB Securities reduced around 8% holding in Kaashyap Technologies ahead of its open offer to acquire 20% additional stake in the Chennai-based IT consulting and services firm. Post open offer that garnered around 7%, it owns a little over 31% in the firm.
Originally promoted by A Venkatramani, Usha Venkatramani, Radiant Systems Inc.(USA) besides Venu Myneni, Vinod Koduru and Raghuram Tandra in 2002, Radiant Systems Inc, Venu Myneni and Vinod Koduru exited the firm. This made the Venkatramanis the sole promoters of the company who held a small stake with a large chunk of shares of the company in the public domain. The shares itself have been trading like a penny stock.
TAIB had stated that it is not interested in taking over the management of the company and sees itself just as a financial investor.