NIIT has to grow at more than the industry growth rate to achieve its self-defined targets and acquisitions will play an important role to meet the goal. What kind of companies you are looking for acquisition?
VKT: We are looking for companies which are in the similar technology space NIIT is working like client server, wireless etc and working on projects where the component of possible offshore development is higher. This will help us in reducing the cost of production by offshore development to recover the return on our acquisition investment faster.

Are you going for acquisitions worldwide or have you selected a few geographies for the purpose?
NIIT will focus only in the US market for its future acquisitions. We do not have the required bandwidth to manage companies outside US. There are several issues such as language, culture and management practices which need to be addressed for an effective management and integration of businesses. I do not think NIIT should go to countries where such issues exist and would confine to the US market only.

What strategy do you adopt to initiate and close acquisition?
We are not going as buyer in the market. It is a difficult route to follow. We are persuing acquisitions through investment bankers and looking for sell side minded companies looking for a right buyer. This has proved to be a more effective strategies for us. NIIT has laid down around 12 criteria to be checked and evaluated before initiating a discussion with any potential company for acquisition. And, take a further course of action as and when the further developments take place.

The slipping valuation of IT companies have made it tricky to acquire a company at the right price. How do you plan to address this problem?
Our acquisition strategy is not valuation based. What we look for, in a company, is how fast the acquisition will be able to provide return on investment. It always make sense to acquire a company if you are confident of getting the desired return within desired time of the investment made.

NIIT has started a concept of e-mahamillionaire which was later converted into NIIT Venture Fund. What is the objective of NIIT Venture? Is it also a alternative route for future acquisitions?
NIIT Venture funds will investment in technology which are peripheral to the technologies, NIIT is already working on. We will make minor equity investments in the companies engaged in developing products or offering services which provide business advantage to NIIT in terms to new customer, new business and extension of its own product and services.

We believe in building business relationship which should result in additional revenue to NIIT from the market. We have earmarked $10 million for making such investment this financial year. However, these investments can be converted into a majority holdings in future if required.