The United States-based WebEx Communications, a provider of web communications services, on Wednesday announced its decision to acquire CyberBazaar, India's leading conferencing company, in a $4 million cash deal.
Under the deal, the Bangalore-headquartered CyberBazaar would become a 100 per cent subsidiary of WebEx, based in Silicon Valley, with CyberBazaar continuing to maintain its India offices, management team and 120 staff employed in India, top executives of the two companies told reporters in Bangalore.
Videoconferencing from San Jose, WebEx CEO and chairman Subrah Iyar said the total consideration to be paid under the agreement was about $4 million in cash, with provision for adjustments based on performance of the business in 2004 and other contingencies.
The acquisition is expected to be closed in the first quarter of 2004.
The acquisition, Iyar said, would help WebEx deliver next generation multi-media communication services in India and provide better services to its multinational customers, who were expanding in India.
He said there would be no change in the name of CyberBazaar immediately, but over time it might be changed.
Iyar said they chose CyberBazaar because it was a conferencing service leader in India, had proven management team, and a strong customer base.
CyberBazaar managing director Rajeev K Purnaiya said the company currently had 500 customers and had achieved a 100 per cent growth year-on-year basis, with revenues at Rs 15 crore (Rs 150 million).
Five-year old CyberBazaar was the market leader in the conferencing sector, with 80 per cent market share in India, its officials said.
WebEx has grown from $2 million revenues in 1999 to $140 million in 2002, with a market share of 64 per cent and is rated by Forbes magazine as the fastest growing technology company over the last five years, based on compounded annual revenue growth of 186 per cent.