MindTree set to buy domestic firm

MindTree Consulting, $100-million software services firm, is set to acquire a domestic semiconductor design company in an all-cash deal. The target company is reported to employ around 200 people.

MindTree has signed a non-binding term-sheet with this firm and due diligence is on, said Ashok Sotta, CMD, MindTree, and added that the buyout would add to its IC (integrated chip) design capability and will also bring in new customers. Company officials said there were a few overlaps in terms of customers.

Soota added the target company has sales presence in the US and a delivery centre in India. Officials said if the acquisition is concluded, a part of the consideration would be paid upfront and the balance would be paid later.

If concluded, this will be MindTree's third acquisition in its seven-year history. The company has made two acquisitions "" software division of ASAP and its subsidiary in September 2004 and Linc Software Services in June 2005.

The company has already announced its plan to float an initial public offering of 55.9 million equity shares to raise Rs 200- 240 crore.