Allied Digital to enter mgmt security services with JV

Mumbai-based Allied Digital, an information technology infrastructure and technical support service outsourcing company, is in talks to form a joint venture with Singapore based e-Cops, provider of security services to enterprises and the government sector. Company sources said an announcement was expected by the end of this week.

Allied Digital will hold a stake of 80 per cent and e-Cop the rest in the JV. The JV is aimed to bring in $45 million (Rs 200 crore) annual revenue in five years.

When asked, Nitin Shah, chairman and managing director, Allied Digital, declined to comment.

The JV will give Allied Digital exclusive marketing rights in 20 countries. It already works with e-Cop to deliver services in India and the US markets.

Allied Digital will use e-Cop’s proprietary technology platform, the Cyclops Enterprise Security Manager (CESM). With this JV, Allied and e-Cop will join together to form a threat intelligence network with six Security Operations Centres (SOCs) across the globe. The multi-regional threat intelligence network will provide threat notifications and associated advisory services based on data collated from SOCs located in USA, India, Singapore, Malaysia, China and Thailand.

The JV will enable Allied to enter into the $4.5-billion management security services segment globally. According to Forrester, a research firm, this represents both the outsourced and software-as-a-services segment. Forrester’s report said while security spending stayed flat for most of 2009, managed security services grew by at least eight per cent.

Allied Digital listed on the Indian bourses and reported net profit of Rs 29.7 crore for the second quarter ended September 30, 2010. Revenue, at Rs 196.5 crore, grew 18 per cent year-on-year. The order book at the end of the quarter was Rs 429 crore from services and Rs 159 crore from solutions.

Allied Digital’s stock closed at Rs 190.4 per share today, down three per cent from the previous close of Rs 196.3.