Subex Azure Limited, a rare software product company among service giants in Bangalore, made India Inc's latest overseas acquisition as it announced on Thursday that it would acquire Canada-based Syndesis Ltd for $164.5 million in cash.
The acquisition, expected to be completed by March 31, marked the latest in an ambitious global play by the company founded by Subash Menon, who pitched the niche company to make products that help mobile phone companies track fraudulent practices and boost revenues by identifying star customers.
The acquisition price marked more than 25 per cent of Subex Azure's market capitalisation of around $580 million.
The Syndesis buyout will be the second major overseas acquisition of the company in less than year. The company, earlier called Subex Systems, had completed the acquisition of UK-based Azure for $140 million in June last year.
The acquisition would enable Subex Azure to expand its portfolio by offering “live” network and service resource management solutions involving highly precice processes and Internet-related technologies.
It would also provide the company with a headstart in the growing operations support software (OSS) domain involving customised software to help telecoms service providers. Industry estimates put the total addressable market involving several support operations at $2.5 billion, which is expected to touch $4.5 billion by 2010.
“Subex Azure has identified a compelling opportunity to replicate its current success by extending its offering to the next generation solution segment through the acquisition of Syndesis, a leading vendor in this segment.
We expect this major acquisition to add significant value for our shareholders,” said Managing Director Subash Menon, who named the company after himself and co-founder Alex Puthenchira, who has since exited the company.
Subex Azure currently has a 29 per cent share in the $216 million global fraud and revenue assurance software solution market.
“The two sets of product portfolios, customers and domain expertise brought together by Subex Azure and Syndesis are complementary,” said John Lochow, CEO of Syndesis.
The acquisition would enable Subex Azure to expand its portfolio by offering “live” network and service resource management solutions involving highly precise processes through automated fulfillment of Internet protocol (IP) based services such as voice over Internet protocol (VoIP) and Internet protocol television (IPTV).