Quintegra to acquire US firm for $49 mn

IT services and product solutions provider Quintegra Solutions will acquire US-based technology consulting company Pingho Associates Corporation (PAC) for a consideration of Rs 198 crore ($49 million).

Under the agreement between the Chennai-based company and PAC, Quintegra will pay $20 million upfront, while the remainder will be EBITDA-linked to the acquiree's corporate performance, in payouts spread over the next three years. The State Bank of India is the principal banker for the deal.

This is the third acquisition being carried out by Quintegra in 2007, after the buyout of US-based software solutions firm ValleyUS and Singapore-based product engineering company JadeLite Technologies in March this year.

Quintegra Chairman and Managing Director Shankarraman Vaidyanathan said the offer price of $49 million was five times PAC's current EBITDA margins, and the payout period over three years would be justified if the acquiree company could touch the $35 million benchmark in profits during the period.

"PAC brings strong consulting expertise in high-end IT consulting and leadership in the space IT services with a strong BFSI, mortgage and brokerage clientele," Vaidyanathan said.

With this acquisition, Quintegra expects to see its global headcount cross 1,000 and consolidated revenues over Rs 400 crore ($100 million), with profits exceeding Rs 50 crore ($13 million) in FY08.