WebEx Comm eyes more buyouts

The San Jose-based WebEx Communications Inc, which acquired CyberBazaar last year for $4 million in cash, is now eyeing more acquisitions in India to grow its business seven fold in three to five years. It is also gearing to make India an important customer service hub for its worldwide operations.

Subrah S Iyar, chairman and CEO, said, "We would be looking at some companies that we are already working with in the country for this. The idea is to expand the scope of our business, covering the entire gamut of multimedia communications and also the spread of sectors covered."

While he refused to divulge any specific information, he said that one of the companies he is looking at is four times the size of CyberBazaar. Two others are smaller than his last acquisition. Incidentally, all these companies are located in the South.

Currently India accounts for less than 5 per cent of WebEx' revenues, but it is growing in terms of product usage. WebEx, which posted a turnover of $189 million in 2003 and closed its second quarter of the current year with $61 million (with a guidance for an annual revenue of $240-250 million in 2004), generates 88 per cent of its earnings from the US.

International operations in Canada, UK, some of the other European countries, India, China, Japan and Australia contribute the remaining 12 per cent. "We expect India to constitute 15-20 per cent of our incremental revenues in the next three-five years," Iyar added.

Iyar is banking on the BPO boom in the country, especially in the higher end of the value chain, to grow his business base here.

Clearly India is expected to become a vital end of WebEx' worldwide operations. "For one, we expect India to soon emerge as the customer service hub for our worldwide operations, handling about 30-50 per cent of the businesses," he added.

Annual investments to support this business will be ramped up to $30-50 million over the next few years. Annual revenues from this business will range between $40 million and $100 million during this time frame.