Tgk Corp Gets Nod To Hike Stake In Arm To 99%

TGK Corporation, a leading developer of enterprise resource planning (ERP) software, has received approval from the Foreign Investment Promotion Board (FIPB) to hike equity stake in its Indian subsidiary, TGK India, from 51 per cent to 99 per cent.

The company has, however, not taken a final decision on the amount of investment it would make in the subsidiary. At present, the paid up share capital of the Indian arm is Rs 2.5 crore.

A decision on the size of the investment will be taken after assessing the needs of the company at the present juncture, sources said.The company was set up nearly three years ago as an authorised training centre of Oracle Corp with a proposed equity base of Rs 5.5 crore. TGK Corp of Japan had decided to pick up a 51 per cent stake. Nearly 40 per cent stake was proposed to be mopped up through a public issue.The remaining 9 per cent of the equity was to be offered to employees as stock option.

 

"However, the public issue got delayed due to a number of factors mainly because the Japanese parent believed the company should have a three year track record before tapping the market for funds," Anil Gupta, managing director, TGK India, said.

TGK India has emerged as a leading player in the development of the ERP software using Oracle tools. It is currently working on a $ 2.5 million sub-contract from IBM (Thailand) which is working on a Thai government programme to computerise its entire direct and indirect tax network.

In India, the company is taking up projects for medium-sized companies with revenues ranging between Rs 100 crore to Rs 300 crore in the processed foods, pharmaceutical and garment exports sector. The company also plans to enter the potential market of integrated system application with its first ERP package.

TGK Corp of Japan, a $ 70 million engineering serivces corporation, has developed the package considering the business environment and offering enough flexibility to cater to future business requirements so as to enable a smooth migration to international practices.

, company chairman Katsuhide Tomonaga said.

He underlined the necessity for solution that caters and responds to the needs of Indian culture and business practices for achieving success in the Indian market.