Mahindra Satyam buys 51% stake in Brazilian firm

The total cost of the acquisition is $23 mn. While $6.3 mn is the immediate payment, the remaining is to be paid over a period of three years

Mahindra Satyam said it acquired a majority stake (51%) in Brazil's Complex IT, a provider of consultancy on the use of SAP AG's business management software.

"The total cost of the acquisition is $23 million. While $6.3 million is the immediate payment, the remaining is to be paid over a period of three years," a Mahindra Satyam spokesperson told Business Standard.

This acquisition will focus on developing solutions for the enterprise solutions market within Brazil. Mahindra Satyam and Complex IT will be going to market with proprietary solutions for large manufacturing, financial and consumer services companies in the market. This initiative marks another important milestone in offering Mahindra Satyam's customers a global delivery capability In Latin America.

"This combination of Complex IT and Mahindra Satyam strengthens our commitment to the Brazilian market, which is one of the fastest growing Enterprise solutions markets. We look forward to expanding our market presence and ofTer global delivery capabilities to our customers" said Arvind Malhotra, Global Head, Latin America & Strategic Accounts, Mahindra Satyam.

Brazil is the second fastest growing geography for SAP, and its IT spends are at around $70 billion, with $36 billion spent on services and software. Software revenues for SAP grew 20 per cent last year.

Satyam expects IT spends to go up as the country gears up to host FIFA world cup in 2014 and Olympics in 2016.

“The BRICs (Brazil, Russia, India and China) have the potential to achieve leadership position in the global economy. This relationship with Mahindra Satyam would mean enhanced career opportunities for our team,” said Antonio Rossi, chairman and CEO of Complex IT.

Mahindra Satyam, had in March 2012, acquired 100% of vCustomer Corporation's international operations for $27 million vCustomer is a Washington-based business process outsourcing (BPO) company. This was the first 100% acquisition of Mahindra Satyam since it became part of the Mahindra Group in April 2009.

The acquisition of vCostumer's international operations also marked the entry of Mahindra Satyam’s BPO operations into other verticals such as retail and consumer technology, in addition to significantly enhancing technical support credentials.

Satyam’s scrip is currently trading at Rs 113.15 on the BSE, down 2.41%, over the previous close of Rs 115.95 a share.