New MphasiS on India

It’s official. EDS today announced the completion of the acquisition of a majority stake in Bangalore, India-based applications and business process outsourcing services firm MphasiS BFL Limited. The purchase was said to be one of the largest in the Indian IT services sector, and provides EDS with some 11,000 India-based employees skilled in advanced applications development, emerging technologies, BPO/CRM services, applications development and business process services-focused sales channels.

EDS met the required US $380 million necessary to purchase the 83 million-plus shares of MphasiS. EDS’ conditional open offer closed on June 5. The transaction is expected to be completed by July, subject to administrative settlement procedures. In fiscal year 2005, MphasiS reported annual revenue of more than 9.4 billion Rupees (approximately US $210 million) and a net profit of a sliver under 1.5 billion Rupees (or approximately US $33 million). Such figures represent the quadrupling in revenue over the past five years MphasiS has experienced.

MphasiS has been promised that its current management team and company name will stay intact following completion of the transaction; specifically staying put will be MphasiS CEO Jerry Rao and MphasiS board of directors vice chairman Jeroen Tas. EDS announced the firm would appoint a majority of the MphasiS board of directors and is evaluating consolidation of existing Indian operations with those of MphasiS. More good news had EDS increasing its work force in India from its current three thousand to nearly seven times that many by January 2007.

EDS takes pride in its claim to have founded the information technology outsourcing industry over forty years ago. Today, EDS provides information technology and business process outsourcing services to clients in the manufacturing, financial services, healthcare, communications, energy, transportation, and consumer and retail industries.