IBM to acquire Indian services company

IBM has agreed to acquire a small Indian infrastructure services company called Network Solutions.

IBM plans to acquire Network Solutions, an infrastructure services company in Bangalore, India.

IBM would acquire the entire equity capital of Network Solutions, making it a wholly owned subsidiary, the company said. It did not disclose other financial details of the deal.

The objective of the acquisition was to strengthen IBM's networking and managed services business for the Indian market, a spokesperson for IBM said. The transaction is expected to close within a month.

Set up in 1993, Network Solutions installs wide area networks (WANs) and LANs, including converged data, voice and video networks. It also offers infrastructure management and network design services.

The privately-held company had been profitable for the past 12 years, its managing director, Sudhir Sarma, said. The current organisation and management of the company would remain after the acquisition.

"We have not decided to cash out, but rather we think this is the best way to take our business to the next level," Sarma said. There are complementarities in the markets that IBM and Network Solutions address in India, he added.

Intel which was an investor in Network Solutions through Intel Capital, its venture capital arm, exited Network Solutions after it acquired the network consulting business of the company in 2000.

"As Intel in India exited some of the lines of business, we built again a network consulting group within the company," Sarma said.

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