Kavveri Telecom Products Ltd, a maker of antennas and radio frequency (RF) products for the wireless industry, has acquired a 67 per cent stake in Canada-based design and development firm, Trackom Systems International, for an undisclosed sum.
As a result of the acquisition, Kavveri will have access to Trackcom’s RF products and antennas up to 40 Ghz, which are used in space, defence and telecom applications.
The company declined to comment on the deal size.
Tracking the deal, shares of Kavveri gained 4.15 per cent on the BSE to close at Rs 48.9 on Thursday.
“It will bring additional products into our portfolio that will strengthen our position in defence, space and telecom markets,” said Mr Shivakumar Reddy, Managing Director, Kavveri Telecom. The company would add 20 R&D engineers through the acquisition. At present it has 50 R&D engineers in India and 20 in North America.
Trackcom sells its technology to companies that manufacture the products. With this acquisition, Kavveri would get control of Trackom’s IP (Internet Protocol).
Kavveri would do the manufacturing of the products either in India or at its North American subsidiaries, Mr Reddy said. The key target markets would be India, US and Europe, he added.
Kavveri expects 15 per cent of its India revenue to come from the Defence sector by 2011-12, Mr Reddy said.
Currently, the space and Defence sector contributes about three per cent to the India revenue.
The company has 12 products for the Defence sector, and the acquisition will add several others. “We are talking to several Defence and space organisations,” said Mr Reddy.
Source: The Hindu Businessline