Satyam looking at buy-outs in Japan
Satyam Computers Services Ltd has charted an aggressive expansion plan for its Asia-Pacific operations, which currently accounts for 16.5 per cent of the company’s total revenues.
The company is eyeing acquisitions in Japan even while adding new development centres in China and Malaysia, said Mr Virendra Aggarwal, Director and Senior Vice-President (Asia Pacific, Middle East, India and Africa), Satyam.
The company is eyeing Tier-II cities in China to set up its fourth development centre, where it plans to have some 3,000 people by end-2008. It currently has development centres in Shanghai, Dalian and Guangzhou, where it has over 300 people, he said.
"Wage inflation and attrition rates in China are similar to those in India. We are looking to expand in Tier-II cities in China and want to develop China as an offshore base for our global customers. It is part of Satyam’s de-risking strategy for North American and European customer base," Mr Aggarwal said.
In Malaysia, the company plans to set up a 500-people, new development centre soon, he said. Currently, about 125 people operate from its development centre in Kuala Lumpur. Nipuna, Satyam’s BPO subsidiary, is also looking at Malaysia for setting up its delivery centre.
In acquisition mode
In Japan, Satyam is looking at acquiring niche companies to augment its strengths in domains such as telecom, banking and business analytics domain and add language capabilities. "We have identified about four to five companies as potential targets," Mr Aggarwal said, declining to comment on the deal sizes that the company was pursuing. "We are seeing good traction in the Japanese market, which is opening up," he said. Japan accounts for about 1.5 per cent of the company’s annual revenues.
Further, Mr Aggarwal said the company’s operations in Asia Pacific and Europe were growing at a faster clip as compared to the US.
"We are seeing great momentum in countries such as Australia, India, West Asia among others," he said. Satyam has also bid for Telstra’s incremental outsourcing orders. The Australian telecom company is one of its top-ten clients.
According to him, the US currently contributes to about 65 per cent of the total revenues and the target is to raise the non-US top-line to account for 50 per cent in three years as part of the company’s "de-risking strategy".
Source: