Sasken to foray into service provider space

Sasken Communication Technologies, which designs telecom software and hardware on its own account and also as a service, is now seeking to become a service provider to telecom operators.

For this the Bangalore-based company, which made two acquisitions during the fiscal 2006-07, is actively considering acquiring a company in this space to fill up certain technology gaps.

Sasken is understood to be talking to four-five companies in North America for acquisitions with a focus on Mexico, Chicago and Dallas regions.

"We are actively exploring the possibility of an acquisition. We have a few companies in mind. This may happen sometime by the end of the present fiscal," said Swaminathan Krishnan, Senior vice-president (marketing) and chief marketing officer (products & services).

The company intends to provide information, commissioning support, planning of radio frequency, deployment of base stations and network infrastructure, and consulting services on evolving a network.

"We could also play a role in designing the networks as it moves between various technologies like cellular, WiMAX or Wi-Fi to ensure interoperability," said Krishnan.

Sasken is looking for acquisitions of firms in the range of $10-30 million. The company expects its revenue from service to become 10 per cent of the total revenues in the next two years.

As of March 31 last, the company had cash reserves of about Rs 70 crore. "Cash is not an issue. We have got the ability to raise money required for an acquisition," said Krishnan.

In July last year, the company acquired Finnish firm Botnia Hightech for Euro 35.5 million. The acquisition has helped the firm have about 300 people in Finland.

Sasken Finland Oy, Sasken's subsidiary in Finland contributed over 20 per cent to Sasken's revenues in the fourth quarter of fiscal 2006-07.

In Mexico, Sasken has an onsite presence of about 100 people at Monterrey. "We are looking at North America (for the acquisition), since we already have a foothold in Europe," he added.

In April last year, Sasken had acquired Chennai-based iSoftTech that works in data networking space, for around Rs 5 crore.

The company, which recently launched a new joint venture ConnectM, in partnership with IDG Ventures India, is also looking at diversifying into the mobile security and gaming areas.

Leveraging its relationships with the chip manufacturers, handsets vendors and networking providers, is aiming to provide solutions to make mobile platforms secure.

In gaming, the building of gaming engine would be one area of focus, according to Krishnan.