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Sify to spin off investment arm

NetScribes/Abhijit Basu

Satyam Infoway Ltd (Sify) is planning to hive off its entire investment operations as a separate entity. To be called Sify Innovations, the new entity is expected to look out for investment options in the Internet and related areas.

"The move is on to form Sify Innovations for bringing all investments under one roof. However, I am not in a position to provide more details on the matter," said Rajesh Jain, member of the advisory board of Satyam Infoway.

George Zacharias, president and chief operating officer of Sify, refused to comment on the issue. When contacted, the company spokesperson confirmed the move and said, "We do not have a fixed time-frame for the project at the moment."

However, company sources said that Sify would consolidate all its future investment initiatives into the new entity, which is expected to start operations by March 2001.

Sify has raised a total of $220.9 million from its American depository share offerings on Nasdaq. While its initial listing in October 1999 raked in $79.2 million, its second offering in February 2000 brought in $141.7 million for the company.

Sify completed its first acquisition in June 2000 with a $125-million deal with IndiaWorld Communications Pvt Ltd. Sify bought 24.5 per cent of IndiaWorld in November 1999 and the rest in June 2000 - for $48 million in cash and 268,500 fresh equity shares.

Next came a $10-million joint venture (March 2000) with the Refco Group to offer online equity and futures trading to retail customers and financial services companies. Refco holds 60 per cent in the new entity, called Refco-Sify, while the remaining equity lies with Sify.

In June 2000, Sify acquired a 25 per cent stake in Cricinfo Ltd, the company that runs the popular cricket portal Cricinfo.com, for $37.5 million in stocks.

This was followed by the acquisition of San Jose-based Indiaplaza.com in July 2000. Sify acquired the company in a $8.l-million all-stock deal.

Sify has since acquired stakes in e-Chem.com, a business-to-business portal for the chemical industry, Formsindia.com, a portal dedicated to offering forms online, and Kheladi.com, a sports portal.

Meanwhile, Satyam Educational Services Ltd, a 100 per cent subsidiary of Sify, also announced its intention to acquire 74 per cent in Eduempire.com for a consideration of $2.16 million. The investment will be spread over a period of three years.

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