Processing .....please wait.. 
The article has been forwarded.... 
War-chest of Big 4 crosses $5.2 Bn
By siliconindia
|
Wednesday, 09 July 2008, 18:56 IST
New Delhi: The 'liquid assets' (including cash and bank balances, as well as investment in liquid and short term mutual funds) of top IT services companies - TCS, Infosys Technologies, Wipro and Satyam Computer Services together have surpassed $5.2 billion during FY08, reports Business Line.
The financial assessment is significant as it places these service providers in a strong position to pursue strategic overseas buy-outs this year even as the industry's largest market - the U.S. - is facing slowdown headwinds.
According to Angel Broking, the liquid assets of the four Indian IT giants were pegged at almost $4.2 billion in FY07.
"Most of the Indian IT firms are looking at inorganic route to fill the gaps and fuel growth, and they may go for smaller acquisitions. However, although the valuations are looking attractive, the expectations of target companies have not come down. Also, the dollar appreciation could take some sheen off from buy-outs in the short term," said a top official of a Bangalore-based IT company.
Over the last six months, Satyam Computer Services has announced some acquisitions. In April, the company acquired Belgium-based S&V Management Consultants for $35.5 million in an all-cash deal. It also announced the acquisition of a construction equipment maker Caterpillar's market research and customer analytics operations for $60 million.
According to sources, Satyam is currently on the prowl for acquisitions in business process outsourcing (BPO), engineering services and infrastructure management services (IMS) space.
Similarly, in August last year, Wipro Technologies had announced the acquisition of Nasdaq-listed outsourcing firm Infocrossing, provider of IT infrastructure management, enterprise application and business process outsourcing services, for about $600 million in an all-cash deal.
Wipro is learnt to be looking at strengthening its foothold in France and Germany through acquisitions. Industry observers also point out that besides strategic acquisitions, IT firms are likely to utilize cash to maintain a high dividend payout ratio.
