HYDERABAD: Megasoft, a Chennai-based software technology company, on Wednesday acquired the Boston Communications Group Inc (BCGI) for $65 million, pricing the common stock share at $3.60.
After the process of due diligence, Megasoft decided to pay a premium of 120 per cent to the share which actually was listed at $2 in Nasdaq. Addressing a press conference here, Megasoft’s CEO and Managing Director, G. V. Kumar, said BCGI was a leading telecom solutions provider with big players like Sprint and Telephonica, among 25 other companies, as its major clients.
Megasoft, which had done a business of about Rs. 180 crore in 2006, was targeting to achieve Rs. 350 crore this year. Mr. Kumar said internal accruals and long-term debts were being leveraged for resource mobilisation to acquire BCGI.
Rs. 100 crore facility
BCGI would become a wholly-owned subsidiary of Megasoft after the completion of the acquisition, for which the process of filing tender offer to purchase the outstanding shares in cash would begin.
The definitive agreement was concluded and the board of directors of both companies had accorded approvals for the deal. The technology on common platforms would be leveraged for enhancing business opportunities. The first phase of the Rs. 100-crore facility being built in Hyderabad by Megasoft would be completed by March-April 2008.