Mold-Tek Technologies is acquiring US-based engineering KPO company RMM Global and its India-based associate Technet Engineering Services.
Will acquire RMM Global and its Indian associate for $1million
MUMBAI: Mold-Tek Technologies, a structural engineering and packaging KPO firm, is acquiring US-based engineering KPO company RMM Global and its India-based associate Technet Engineering Services.
The $1 million deal will enable the Hyderabad-based Mold-Tek to enter the high rise buildings space.
RMM is the US-front end while Technet executes orders from India. Both collectively have about 90 engineers and revenues of about $2 million.
Lakshman Rao, managing director, Mold-Tek Technologies, said the companies would be acquired for about $1 million.
The deal will make Mold-Tek Technologies the largest such global player, Rao said. The company’s KPO strength will also go up to 400.
Mold-Tek is de-merging its flagship plastics division to become a standalone structural engineering KPO. It would be the only listed Indian company in the space.
As per the de-merger scheme, for every 100 old Mold-Tek Technologies shares, shareholders would get 28 shares of new Mold-Tek Technologies (the KPO business) and 72 shares of Mold- Tek Plastics.
In FY08, fired by a 70% grown in its KPO business, the company expanded topline by 20% to Rs 114 crore. Of this, the plastics business accounted for Rs 95 crore.
However, the KPO business enjoys higher margins-over 55% at operating level — and is seen growing at a faster clip. Rao said, for
FY11, the KPO business is expected to generate Rs 70 crore, against plastics’ Rs 190 crore. However, KPO’s net profit is seen at Rs 24 crore against Rs 16 crore from plastics.
Mold-Tek entered the structural engineering KPO space in 2001. In the past, it has acquired American detailing firm, Crossroads Detailing Inc.
Rao said these acquisitions would give the company the capability to bid for bigger projects, particularly in the high-rise buildings space.
The company mainly gets its revenues from the US market and now is expanding into Canada, Europe and Australia, which are expected to become significant geographies.
Mold-Tek’s plastics division manufactures packaging products for paints, lubricants, pharmaceuticals, cosmetics and FMCGs etc.
g_rabin@dnaindia.net
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