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Subex to buy UK co for $100 mn

Bangalore-based Subex Systems, is close to acquiring a UK-based telecom security services company for more than $100 million.

india Updated: Apr 25, 2006 09:20 IST

Bangalore-based Subex Systems, a telecom software services company, is close to acquiring a UK-based telecom security services company for more than $100 million (Rs 450 crore). Subex’s board is meeting on Tuesday to approve the acquisition.

Though the name of the overseas telecom services company could not be ascertained, sources said that the company is mainly involved in the revenue assurance solutions business where Subex has a major presence.

The industry grapevine is throwing up lot of names. London-based  revenue assurance sharing solutions company Azure Solutions seems to be the most likely target. Other names doing the rounds are Beck Computer Systems, Ansapoint and Anied Telecom. When contacted, Subex officials declined to comment. Over the last one month, Subex share price has seen an almost 25 per cent increase to close at Rs 500 on the BSE on Monday. Bangalore-based investment banker Indage is the advisor for Subex Systems. Sources said that officials from the UK-based company has recently visited Bangalore to finalise the transaction. “Subex is planning to fund the acquisition through a combination of stock and cash,” said a source in a Bangalore-based investment banking firm. The acquisition will help Subex to enter UK and Europe, which is an area where they did not have a strong presence  compared to their strong foothold in American and Latin American markets, said an analyst from a leading research firm. 

Subex has been acquiring businesses to consolidate its overseas presence. It had recently bought out the fraud management business of Virginia-based Mantas for $2 million. Prior to that it had acquired the fraud management division of Alcatel and US-based Lightbridge Inc, a value-added transaction processing company. This acquisition added 14 new clients to Subex's customer base and enabled to consolidate the company's position in the fraud management solutions segment. With Mantas, it had acquired the intellectual property relating to Mantas' fraud management product and the customer relationship maintenance contracts worth $2 million.