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| The US-based Perot Systems has acquired HCL Technologies' stake in their joint venture, HCL Perot Systems, for $105.3 million (Rs 479.6 crore) in cash, thereby ending a two-year feud. |
| With this deal, the $1.3 billion Perot Systems' holding in the joint venture has gone up to around 88 per cent from 45 per cent. |
| HCL Technologies held around 43 per cent in HCL Perot Systems, while 45 per cent was held by Perot Systems. The balance is held by the employees and the management of the company. |
| "The deal marks the resolution of the differences between the two companies," said David Cohen, managing director, Perot Systems Europe. |
| According to Shiv Nadar, chairman and chief executive of HCL Technologies: "The agreement with Perot has also resolved the channel and brand conflicts between us. It will help both the partners to pursue their goals independently." |
| In a statement, HCL Technologies said it had a history of successful joint ventures, some of which had been amicably concluded with one of the partners buying out the other. |
| "Similarly, HCL and Perot arrived at an understanding that the stakeholders in HCL Perot Systems would be best served with a single ownership," the statement said. |
| The assets of HCL Perot Systems, which was set up in 1996, include approximately $45 million in cash and short-term investment besides fixed assets. The company, which has 2,300 employees, earned a revenue of $78.7 million and net income of $9.3 million during the first nine months of 2003-04. |
| Asked why Perot Systems was buying out its partner in the joint venture, Cohen said, "HCL Perot Systems has been an integral part of our team. We have realised that it will add more value if controlled by a single company. For HCL, this has been a great return on investment." |
| Post-acquisition, Perot Systems wants to develop the Indian company into a offshoring unit. |
| "HCL Perot Systems has been an important part of our onshore and offshore delivery model for more than six years. Therefore, acquiring it was the next logical step in the development of our onshore and offsite application outsourcing model. Not only does this expand our global software team, but also provides us with new clients to expand our business," said Ross Perot, president and chief executive of Perot Systems. |
Countdown to the break-up
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