Patni to acquire US-based Cymbal for $68mn

All-cash deal; to increase telecom expertise.

Patni Computer Systems, through its wholly-owned subsidiary in the US, has entered into an agreement to acquire Cymbal Corporation for a total consideration of approximately $68 million in cash to be paid over a period of time.

Cymbal Corporation, based in California, is an IT-services company with domain expertise in the telecommunications industry.

According to a release issued to the BSE today, the acquisition will help Patni to;

1) Make an entry into the telecommunications vertical with over 20 customers with many of them generating more than $1 million in annual revenues; and

2) Obtain a strong management team whose goals are aligned with the company's long-term strategy to provide end-to-end solutions in the telecom space with deep industry expertise.

The finalisation of the transaction is subject to certain closing conditions and regulatory approvals as may be required.

While Kotak Mahindra Capital Company acted as the sole financial advisor to Patni, Avendus Advisors acted as the sole financial advisors to Cymbal, according to a release on the website of Patni.

"Cymbal registered revenues of $32 million in June 2004, and has an employee and consultant base of over 500 professionals in seven global offices including established offshore delivery centers in Hyderabad and Pune," the release said.

Patni touched a 52-week high of Rs 373.90 on the BSE in early morning deals today. The stock is now trading with a gain of over 2% at Rs 357.