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SSI to join hands with Scandent group

By Our Staff Correspondent

CHENNAI DEC. 20. SSI Limited and the Bangalore-based Scandent group propose to de-merge their IT services businesses and amalgamate them into a new company. The proposed new entity, in which SSI and Scandent shareholders will hold equal equity, will be a mid-sized IT services company with a projected combined annual revenues of $60 million and over 1,100 employees.

Addressing a press conference here today, Kalpathi S. Suresh, Chairman and CEO, SSI Ltd., said the shareholders of SSI would get one share of the new company for every SSI share held by them.

The method is to float a new company first, de-merge the software service business of SSI and amalgamate it with it. The entire process is expected to take six to nine months.

SSI per se will become a sort of holding company. It would be flush with cash to the tune of Rs.30-40 crores.

The new company born out of the merger of software businesses of SSI and Scandent would have a foreigner as its Chairman. Christopher A. Sinclair, founder and non-executive chairman, Scandent Group, would be non-executive chairman of the proposed merged entity. Ramesh Vangal, founder and CEO, Scandent Group, would be the CEO and Mr. Kalpathi would hold a non-executive position on the board of the new company. The operational headquarters of the new company would be Bangalore.

Ramesh Vangal, said the proposed new entity would have significant domain expertise in the government, BSFI and logistics verticals. Scandent group's offering in the IT and the enterprise solution sector would complement SSI's skill while Scandent's engineering services would broaden the range of services offered to customers.

The Scandent group had a strong offshore delivery model, which would strengthen onsite presence, thus improving the profitability of the merged business.

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