Tech Mahindra, the IT outsourcing business of the $16.2-billion Mahindra Group, has acquired US-based big data analytics startup FixStream Network for around Rs 60 crore.
Tech Mahindra will acquire 75% stake in the one-year-old company which counts large technology companies Cisco Systems, CenturyLink, and DirecTV among its early stage customers.
“This is a good deal for both the companies,” said 50-year-old Abhinay Padhye, who co-founded the company in May 2013 along with his former colleague at Cisco, Sameer Padhye. They bootstrapped the company with a personal investment of Rs 9 crore.
“We are now planning on expanding into networking and big data,” said Padhye FixStream has developed a technology platform that mines hidden insights, patterns and unknown correlations from huge amount of data in datacenters.
In a statement to Bombay Stock Exchange, Tech Mahindra said the startup will develop emerging technology which will benefit its customer base. “Such acquisitions are much needed to keep the innovation cycle going on,” said Kumar Rangarajan, co-founder of Bangalore-based Little Eye Labs which was acquired by Facebook in January for Rs 90 crore.
“This will inspire more entrepreneurs and trigger bigger successes.” The shares of BSE-listed Tech Mahindra closed 0.17% up on Monday post announcement of the deal.
Experts said the acquisition will help Tech Mahindra to leapfrog in terms of innovation , talent and time-to-market.
“For Indian entrepreneurs this is a good sign that small exits can also happen, which is the life-blood of the entrepreneurship ecosystem,” said Ravi Gururaj, chairman of the Nasscom Product Council. In February, Tech Mahindra acquired IT and consultancy services business of chemical company BASF in a bid to strengthen its presence in Western Europe.
In the next five years, experts say at least 40 technology ventures in India could be bought over by large corporations. This month, US-based technology services company Symphony Teleca acquired Bangalore company Aditi Technologies for Rs 450 crore – 480 crore in one of the biggest deals in the sector this year.
Source: Times of India