Megasoft Limited (BSE CODE NO: 532408), a transnational Intellectual Property-driven, product-based technology company, today announced it has entered into an agreement to amalgamate VisualSoft Technologies (BSE CODE NO: 53221 NSE CODE VISUALSOFTEQ), a leading software solutions and Outsourced Product Development company. With this merger, Megasoft will be able to strengthen its products and total solutions offering in the global markets. This would be an all stock transaction with the ratio likely to be at the market price ratio. The final ratio is subject to independent valuation and due diligence by both the companies. Megasoft expects the whole process to be completed in around 4 – 6 months.
Megasoft has been a leader in providing R&D and innovative software solutions to mobile service providers and this acquisition is expected to help it to scale its product offering portfolio faster. The acquisition also gives Megasoft additional resources in terms of back office for all the new contracts to be signed in Americas and Europe.
GV Kumar, MD & CEO, Megasoft Ltd. said, “The growing global telecom outsourcing to India and the fast expanding MVNO market meant that we needed to strengthen our operations. With almost 250 – 300 telecom trained expertise readily available, right here in Hyderabad with a terrific infrastructure and CMMi level 5 was a crucial clincher for this merger. The combined entity is well poised to win large and strategic outsourcing deals in Telecom, in the specialist domains of roaming, interoperability infrastructure, subscriber authentication and OSS technologies.”
Sudhakar R Gunturu, Managing Director VisualSoft Technologies said, “We see tremendous growth opportunities through this merger with Megasoft. This will enable us to offer a compelling portfolio of product engineering and other high end value added solutions to our customers across the globe.”
The top management of both companies has reiterated their commitment and focus on executing this exercise smoothly.
Deal Highlights
Financial
• Valuation approx Rs. 172 crores (Assuming market prices. Likely ratio ; Every 8 shares of VisualSoft will be replaced with 5 shares of Megasoft)
• All-stock deal
• Closing expected in 4-6 months
Operational
• GV Kumar to head the whole Megasoft operations including VisualSoft, post merger
About Megasoft Limited
Established in 1994, Megasoft is a transnational Intellectual Property-driven, product-based technology company that focuses on its expertise in the growing Telecom sector. The company has initiated a strategic transition – from a midsized IT services company to a leading domain-led Intellectual Property (IP)-driven technology company. Megasoft is a SEI CMM Level 4 company that operates out of USA, UK, Singapore, Malaysia and Germany, and in Hyderabad and Chennai in India. Megasoft is publicly listed in the Bombay Stock Exchange and the Madras Stock exchange. Megasoft has a January~December Financial Year. For the fiscal ending December 31, 2005, the revenues stood at Rs. 115 Crore (Rs.85 Crore for full year FY 2004) and profits were Rs. 20 Crore. After the amalgamation of Xius with it in 2004, Megasoft’s Telecom offerings are now being offered to Telecom operators across all continents. Additional information about Megasoft is available at www.megasoft.com
About VisualSoft Technologies
VisualSoft Technologies is a leading software solutions and Outsourced Product Development company. Founded in 1995, VisualSoft's Technology Development Center is located in India with offices spread across the globe. With SEI-CMM Level 5 quality practices and excellent development teams, VisualSoft has been successfully empowering its customers globally with innovative end-to-end technology solutions. More information on VisualSoft is available at www.visualsoft-tech.com
