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News >> Technology >>
SSI, Scandent group to merge
By siliconindia staff writer
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Monday, 22 December 2003, 20:30 IST
CHENNAI: SSI and the Scandent Group, promoted by the Kalpathi family and Ramesh Vangal, respectively, today announced their decision to merge their IT services businesses. The merged entity, in which both SSI shareholders and the Scandent group will have 50:50 holding, will become one of the top tier-II software services companies from India with a topline of $60 mn and 1100 employees.
As per the scheme of merger, SSI would first demerge its technology division as a listed entity, which in turn will acquire Scandent's IT services business by issuing stock. During the course of six-month long merger process, SSI shareholders will be issued one share of the merged entity for every one share they hold in SSI. The shareholding pattern of the merged entity with a share capital of Rs 46 crore will be as follows: Scandent group 50%, Kalpathi Family 15% and public 35%.
The merged entity will be headed by Christopher A Sinclair, founder and non-executive chairman, Scandent group, who will be non-executive chairman of the proposed merged entity. While Scandent's CEO Ramesh Vangal will be the CEO of the merged company, Kalpathi S Suresh, chairman of SSI, will have non-executive directorship on the board.
"We believe this merger will create significant value for SSI's shareholders as they become a part of a larger company listed company, with increased size, wider range of skills, and delivery and support across a larger number of global locations," said Mr Suresh.
"Post-merger, SSI as a listed company would be left with a cash of Rs 30-40 crore and holding in Aptech. Though we have not yet decided on the future course of action for SSI, we are looking at ideas like angel funding," he said.