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BIT Tech sets base in India for acquisitions

Fakir Chand in Bangalore

BIT Tech Ltd, a US-based upcoming high-end IT services and solutions provider, set up by an home-grown Indian techie at Woodbridge in New Jersey three years ago with his own funds, has set up base in India at Pune and Bangalore for strategic acquisitions in the next 2 years.

The $17-million privately-held company, which provides e-commerce solutions and services to the likes of Cisco, Sun, Lucent, Sprint, FedEx, KPMG, and Goldman Sachs in the US, has earmarked so far $4-million for acquiring entrepreneurial software companies in Bangalore and Pune.

"We have already identified 2-3 companies in both the hi-tech cities with expertise in e-commerce and m-commerce areas that will enable our company to leverage our strong marketing presence in the US," claimed BIT Tech's CEO Ashwani Jasti in Bangalore.

As valuations are going on, Jasti declined to disclose the names of the targeted companies though investments will be to the tune of $1-million each. "The acquisitions can be either an outright buy-out, or taking majority stake so that we can bundle their technology skills with our delivery mechanism," Jasti stated.

Meanwhile, BIT Tech has decided to invest $25 million in its Indian operations to set up two dedicated software development centres at Pune and Bangalore for outsourcing the needs its top-end customers based in the US as well as Europe, where web-enabling and mobile services built around WAP technologies are witnessing an exponential growth.

"Our India strategy is two-fold: one is to capitalise on the existing technology base by acquisitions, and another is to tap the reservoir of talent available in the country for developing high-quality e-commerce and m-commerce solutions and products through the offshore development facilities," Jasti asserted.

BIT Tech also plans to develop e-commerce applications for brick and mortar companies across the board so to enable them migrate from their stand-alone legacy systems or client-server set-ups to Web-based transactions and exchange of information, including data.

"The niche area we are dealing in is estimated to be around $11 billion in market size in the US alone, according to a study by the Gartner Group. Currently, we have about 200 consultants providing on-site services. The number will be doubled in the ensuing year," Jasti disclosed.

In addition to onsite offices at Fremont (CA), Plano (TX), and Philadelphia (PA), the company will be opening a few more at Manhattan (NY), Seattle, Chicago, and Atlanta.

With only $0.3-million turnover in the first year of operations, BIT Tech's compound growth rate was phenomenal as it posted a record revenue of $17 million in the present year.

Even as the company finalises acquisitions and investment plans in India, the co-founder is projecting a revenue income of $50 million by the end of 2001, to register a whopping 350 per cent growth rate next year.

As a strategic alliance partner of the US-base BEA Systems, which creates the Web logic Java application services, BIT Tech will provide wireless applications for e-business and transformation, web-enabled business solutions, CRM, OS, ES, Middleware. Application development, re-engineering, product implementation, and infrastructure management.

On the source of funding its Indian operations, BIT Tech will raise them from its cash-rich internal accruals and investment banks. Jasti has, however, no plans to dilute his majority stake nor go for venture funds to raise additional capital.

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