Indian Mastek Buys American Vector For $9-Million
posted in Outsourcing News and Top Outsourcing deals, Outsourcing to India |Source: Business-India
Mastek, a Mumbai-based IT services firm, has acquired Vector Insurance Services (Vector), a US-based technology solutions provider and third party administrator, whose main focus is mainly on the North American life & annuity insurance industry.
A news release issued by Mastek to the BSE, MajescoMastek, the company’s wholly-owned US subsidiary, will hold 90% stake in Vector, which will operate as VectorMastek.
The consideration for the acquisition is to be paid partly in cash ($4.5-million), and partly by way of future earnings ($4.5 million) over two years, the release adds.
Mastek’s reported total income for its first quarter was Rs. 214.8-crore, a 19.7% increase over 2006’s corresponding quarter. This was driven largely by higher contribution from its US operations, which posted a 28% growth, earning net profit of Rs. 23.8-crore over and higher than the corresponding quarter last year.
In March this year, Mastek pulled out of its five-year joint venture with Deloitte Consulting citing stagnant revenue and falling profits. The proceeds from exiting the venture were to be used to acquire a US-based firm that provided application development in the insurance or the government segment. With the acquisition of Vector Insurance Services, it has achieved its requisite target.
