India's Satyam Plans Expansion in Asia-Pacific Region

Posted 19 September 2006 @ 10:06 am EET     Print     Reprint     E-Mail     Comments

BANGALORE (AP) - Indian software firm, Satyam Computer Services, plans to expand its Asia-Pacific presence in a bid to boost revenues from the region. India's fourth largest software house aims to buy a couple of niche companies in Japan and open new development centers in China and Malaysia, Satyam director and senior vice-president Virender Aggarwal was quoted as saying Friday.

Satyam has already shortlisted four to five companies in Japan and "is expected to strike a deal soon," Aggarwal said in a Deccan Herald report. "We are not looking for capacity but for acquisitions in niche areas of (the) telecom, banking and business analytics domain and to add Japanese language capabilities," he said.

Japan, with about 10 clients, contributes 1.5 percent of the company's total revenues and Aggarwal said "acquisitions are the only route to crack the Japanese market." Large-scale outsourcing deals were expected to emerge from Japan within the next 18 months. "Hence, we want to be ready for the action," Aggarwal said.

Satyam will also open its fourth development centre in China, taking its total staff in the country from 400 to 3,000 by the end of next year. "Wage inflation and attrition rates in China are similar to those in India. We are looking to expand in (second-tier) cities in China and want to develop China as an offshore base for our global customers," he said.

The Business Standard newspaper, quoting Aggarwal, said the firm was also expanding in other regions such as Malaysia, Thailand and Australia. Sixteen percent of the company's 1.1 billion dollar revenues come from the Asia-Pacific region and it plans to increase it to 20 percent over the next three years, the newspaper said.

Aggarwal said Satyam would also increase its employee headcount in Malaysia from the 125 to 500 by next year and the firm was evaluating the country as an alternate center for its outsourcing operations. The company's development centers in India, the United States, Europe, Japan and Singapore serve more than 300 global companies, including 70 Fortune 500 corporations.