Cranes Software effects restructuring process

Cranes Software, a Rs 500-crore publicly-held software products company in the engineering and analytics space has effected a restructuring of its business in an effort to unlock value in the business.

The company has carved three lines of business focussed on products, services and solutions from the erstwhile structure which was aligned along the verticals — analytics, engineering and technology. The company, post this, may look to rope in partners at the vertical or at the enterprise level. Industry sources indicate that Cranes may look to raise around Rs 300 crore with this move.

Cranes Software is leveraged four times under a debt of Rs 800 crore including Rs 250 crore of FCCBs, on which the company has a discounted buyback option. Excluding this, the debt will be around Rs 550 crore of which Rs 400 crore is long-term debt. According to industry sources, Cranes may look to settle Rs 150 crore short-term debt from a fresh infusion of Rs 300 crore.

Asif Khader, MD, Cranes Software, confirmed the move to restructure the business and said that that this will hasten the process of equity infusion.

He added that product business account for 40 per cent of the topline, while solutions come in with 50 per cent and the rest 10 per cent from the services business.

Since 1991, Cranes has been effecting an expansion strategy of acquiring software products, adding value and expanding its available market. It has over the past six years spent close to Rs 500 crore to acquire 16 companies or product IPs. It invested Rs 800 crore accrued from profits in enhancing and expanding the software products it acquired.

Cranes Software, which counts General Motors, Eli Lilly, Ashok Leyland and Tata Group in its client roster employs close to 1,000 people.