Infy,Wipro hunt for buys in new geographies

In the time of a downturn,cash-rich IT major Infosys Technologies is scouting for acquisitions in new geographies,and is willing to spend $450-500 million on the purchase. Speaking on the sidelines of the CII-organised ICT East conference here on Wednesday,S Gopalakrishnan,CEO and MD,Infosys,said: “Typically we look at companies which are 10 per cent of our revenues or smaller. If a larger company comes we may consider it. Our revenue is about $4.6-4.7 billion,so the acquisition would be around $450-500 million.”

The company,keen to expand to new geographies,is looking at acquisitions in places like Europe,West Asia,Latin American countries,Japan and Australia. The acquisition will no doubt help India’s second largest software exporter to diversify client base. IT major Wipro too is also looking to add new geographies to its portfolio. “We have already added some new regions. We are growing pretty well in the West Asia. We have been growing in Australia and in Brazil. We are also looking at North America and Europe,” said Suresh C Senapathy,executive director & CFO of Wipro Ltd. Foracquisitions,Wipro is looking at emerging economies,either in the Asia-Pacific region,the West Asia or Latin America. “We will definitely look at a company which has at least $30 mn revenue. But it does not mean that we will never look at smaller companies,” he said.

Wipro posted net profit of Rs 10.16 bn for the first quarter (April-June) of 2009-10,registering a 12 per cent YoY growth. Asked whether the IT industry will see growth this year,Gopalakrishnan said the industry is hopeful of a “double digit growth in 2010.” Infosys posted a 17.3 per cent growth in first quarter net profit,beating street expectations.

On hiring plans,he said the company “needs to get a signal that the situation has improved before we go to the campuses.” Infosys will relook recruitment at the end of the year,Gopalakrishnan said. “If things improve we may go back to campuses in January-February,” he added.