Wipro looking for larger buyouts
After acquiring half-a-dozen overseas firms over past 11 months, Wipro Ltd said Wednesday that it was looking for slightly larger buy-outs.
"Our acquisition strategy is not confined to overseas alone. We continue to look for acquisitions within the country as well as abroad," Mr Azim Premji, Chairman Wipro Ltd, told a post-results press conference. The proposed buy-outs could be in areas of consumer care and information technology.
The growth rate of revenues from its recent acquisitions is significantly ahead of the company’s growth rate in the second quarter of 2006-07. "Acquisitions in aggregate turned around to deliver a marginal profit during the September quarter as compared to a loss in the previous quarter," he said.
The six acquisitions contributed about Rs 137 crore in revenue to the global IT and product business during the quarter. They also contributed Rs 1.4 crore towards Q2 operating profits of the company. Mr Suresh Senapaty, Chief Finance Officer, Wipro Ltd said the company’s future acquisitions were going to be bigger than in the ones in the past.
"Perhaps you will see the size of the acquisitions to be larger than what we have done so far," Mr Senapaty said. If the average size of the company’s acquisition so far is in the $20-25 million range, "you will see lots of bigger ones going forward," he added.
However, Mr Senapaty hastened to add that it does not mean that the company would go in for acquisitions in the $500 million to $1 billion range, which again is not ruled out. Wipro had cash and cash equivalents to the tune of $800 million at the end of September quarter, which could be utilised for buyouts, he said.
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