VAST managing director T Kannan Jagan told The Financial Express that the company was likely to pay up to $2 million to take over the management of a US firm offering high-end solutions in the financial sector. The deal is likely to be sealed by the end-'99.

Headquartered in Chennai, where it also has its offshore development centre, the company also has training (see box) and development operations in Bangalore.

VAST already has a fully-owned subsidiary in the US (VAST America) and a 50:50 joint venture with a diversified German group (VAST Deutscheland) that will go onstream early next month. Jagan heads the board of the joint venture. The company also has a marketing alliance in the UK.

The details of the IPO here and the equity floats in the US and Germany are being worked out in consultation with ICICI, the company's venture capital partner which has a sizeable chunk of the equity.

In fiscal '98-99 ending March 31, VAST and its American arm together totted up around Rs 20 crore in revenues of which the Indian parent made Rs 7.9 crore.

The acquisition/management takeover of the US firm will be funded from internal accruals and reserves, Jagan said, adding that while the company was being wooed by venture capitalists it would rather raise more funds on that route from ICICI or with another player after consulting with the financial institution. He said the amount of venture capital VAST would go for was still undecided.

With a staff of 120, likely to go up to 200 by 2001, the company is planning to shortly put up a block of between 5 and 10 per cent of its equity (likely to be expanded soon through the capitalisation of reserves) for employee stock options.

Over the past nine years, the company has moved from its domestic base for financial products (it has five offerings catering to the financial and manufacturing sectors) to offshore software development that now accounts for 90 per cent of its revenues.

(L)earning curve

Vast is conducting a unique training programme called Dextra that it plans to brand and offer in the IT job market that is starved for manpower with an understanding of diverse industries and businesses. Under the programme, steered by the head of the company's training division and senior vice president S Nagarajan, professionals from other industry environments such as banking and manufacturing are handpicked to undergo a 6-month course. The student is charged Rs 85,000 for the course which is refundable if he stays with the company for three years. The result? A well-rounded IT professional.