Indigo and its group of companies offer software solutions focussed on the financial sector. This acquisition, SSIL hopes, would enable it to enter the lucrative E-commerce market without any gestation period for product development.

The acquisition has been structured by way of issue of Rs 12.06 crore worth of SSIL's equity shares on a preferential basis to the existing shareholders of Indigo Inc. This will entail a maximum issue of 2,40,000 equity shares representing a minimal dilution of 2.02 per cent of SSIL's existing Rs 51.86-crore equity share capital.

Indigo Inc is promoted by two NRIs, Chandra Balaraman and Sashi Chimala. Other major investors include ICICI Venture Fund Management Company, Indus Fast Holding and Super Hill Investments Mauritius. About 8 per cent of the Indigo's share is also vested with key employees.

While the US unit of the company is mainly into consulting and contract services, Indigo India offers solutions for on-line web-based securities trading system implemented in a leading brokerage house in Taiwan and Tandem-based stock exchange automation product, operational in Madras Stock Exchange. The company also holds the exclusive licence for SWIFT (Society for Worldwide Interbank Financial Telecommunication) in India.

This acquisition will create additional quality revenue channels in the medium-to-long term and shareholder value will be enhanced as a result, SSIL chairman and CEO K Suresh said.

SSIL recorded an income of Rs 42.39 crore for the year ended June 30, 1998. and paid a dividend of 35 per cent for the period. The company board is scheduled to meet on August 12 to consider the new acquisition.

Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.