Hyderabad-based publicly listed IT services and solutions company, Kellton Tech Solutions Limited has acquired US-headquartered enterprise solutions and business integration services provider ProSoft Group for about $14 Mn. Prosoft which has 4 companies i.e. Prosoft Technology Group Inc, Intellipeople Inc, Cyber-World Solutions Inc and Prosoft Business Solutions LLC will now come under Kellton.
The company said that the acquisition will add $40 Mn to Kellton Tech’s top line, taking the combined revenue to $80 Mn by March 2016. ProSoft will continue to function as an independent entity under the parent company. On the other side, ProSoft founder Raj Gupta will continue to head its operations, and will also be part of Kellton Tech’s board.
Kellton Tech had reported revenues of about $21.5 Mn in the financial year ended June 2014 and expects to touch a revenue of about $78 Mn this fiscal, and reach $100 Mn by August 2016.
Prosoft is eighth acquisition for Kellton, Niranjan Chintam said that the acquisition will help ProSoft would strengthen the capabilities of Kellton to go to a much larger customer base, especially in the ecommerce space.
“ProSoft will provide us with the required bench. The acquisition will bring 375 employees of ProSoft, including 120 working out of its global delivery centre in Hyderabad, to our fold, taking the combined global headcount to over 1,000,” Chintam said.
Besides reinforcing Kellton’s expertise in WSMAC (web, social, mobile, analytics and cloud), Internet of Things and other cutting –edge technologies while amplifying its capabilities in ERP-EAI (enterprise resource planning and enterprise application integration) arena, and will further give Kellton annuity revenues through maintenance contracts that ProSoft has with its clients, said Raj Gupta, chief executive officer of ProSoft Group,
He further added that they have maintenance contracts with 12 of its 75 active customers, with annuity revenues of $500,000 to $1 Mn.
With this, Kellton Tech is now actively looking at acquiring two more companies, with revenues of between $9 Mn and $10 Mn, in the US and Europe. “We recently issued three million warrants, which will give us close to $4.5 Mn in equity. This will be used to fund the proposed buyouts,” Niranjan said.
A lot of action is taking place in the Hyderabad tech ecosystem, just last week, Hyderabad-based interior design technology startup Renderlogy has raised $1 Mn in a new round of funding led by Mumbai-based Astarc Ventures and another startup, MartMobi was acquired by ecommerce giant Snapdeal. Last month, Mapmygenome, the company behind the personal genomics and predictive tests brand Genomepatri™ had raised over $1 Mn in Pre Series A round of funding.