NEW DELHI: HCL Technologies, India’s fifth-biggest technology firm, is in advanced talks for its first acquisition in the life sciences space.
The New Delhi-based firm did not disclose further details of the deal. However, the acquired company or companies would start contributing revenues of “$10 million to $15 million by 2009”.
“We came out with a list of 200 companies and then short listed seven possible targets in the US, Europe and India,” Pradep Nair, vice-president and global head of life sciences and healthcare practice at HCL, told DNA Money.
However, Nair said, from the selected firms, HCL would “acquire one or maximum two”. He added that the acquisitions are to service some “unique customers” of the target firms.
“So in the first year of the acquisition, that ($10-15 million) would be the exact revenue of those firms … and next year it could be an increment of 10%-11% or even 100% based on the market situation,” Nair added.
HCL Technologies’ life sciences and healthcare business would contribute $120 million to the firm’s topline this year, and the company is expecting 100% growth for the ‘09 fiscal. It has 14-15 customers in this domain and is targeting the top 50 drugs and devices companies as its clients. The life sciences and healthcare vertical has a 2,500-strong workforce and operates from HCL’s Noida and Chennai centres.
Meanwhile, to derisk its business from the US slowdown, HCL will focus on verticals like life sciences etc “which are not the traditional outsourcing segments”. This vertical contributes close to 6% to the company topline.
HCL estimates that market opportunities in the pharmaceutical IT outsourcing space will be $4 billion by 2010. The company expects to grab $650 million of the pie.
However, one senior analyst believes the $650 million target by 2010 “seems ambitious”.
“Their target of $650 million is pretty ambitious for their current levels … acquisitions will play a big role to achieve that target,” an analyst said on condition of anonymity.
The New Delhi-based firm did not disclose further details of the deal. However, the acquired company or companies would start contributing revenues of “$10 million to $15 million by 2009”.
“We came out with a list of 200 companies and then short listed seven possible targets in the US, Europe and India,” Pradep Nair, vice-president and global head of life sciences and healthcare practice at HCL, told DNA Money.
However, Nair said, from the selected firms, HCL would “acquire one or maximum two”. He added that the acquisitions are to service some “unique customers” of the target firms.
“So in the first year of the acquisition, that ($10-15 million) would be the exact revenue of those firms … and next year it could be an increment of 10%-11% or even 100% based on the market situation,” Nair added.
HCL Technologies’ life sciences and healthcare business would contribute $120 million to the firm’s topline this year, and the company is expecting 100% growth for the ‘09 fiscal. It has 14-15 customers in this domain and is targeting the top 50 drugs and devices companies as its clients. The life sciences and healthcare vertical has a 2,500-strong workforce and operates from HCL’s Noida and Chennai centres.
Meanwhile, to derisk its business from the US slowdown, HCL will focus on verticals like life sciences etc “which are not the traditional outsourcing segments”. This vertical contributes close to 6% to the company topline.
HCL estimates that market opportunities in the pharmaceutical IT outsourcing space will be $4 billion by 2010. The company expects to grab $650 million of the pie.
However, one senior analyst believes the $650 million target by 2010 “seems ambitious”.
“Their target of $650 million is pretty ambitious for their current levels … acquisitions will play a big role to achieve that target,” an analyst said on condition of anonymity.
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