Brainhunter

Friday, December 31, 2010

Zylog Systems is eyeing smart gains as the company is looking for niche acquisitions in US

Zylog Systems is eyeing smart gains as the company is looking for niche acquisitions in US. The company is planning for an investment of USD 80-100 mn. In an exclusive interview with CNBC-TV18, P Srikant, ED of Zylog Systems says that the company is looking acquisitions in US currently.


“We have been constantly looking out for some niche acquisitions which we have been doing right from the year 2003. US will be our focus for now because we have not done a large acquisition within US right from the year 2003,” Srikant said.


Below is a verbatim transcript of P Srikant's interview with CNBC-TV18's Ekta Batra and Reema Tendulkar. Also watch the accompanying video.  


Q1: Can you throw some light on your acquisition plans. You are doing some due diligence for certain companies in the US we understand, could you just throw some light on the acquisition or the ticket size and where exactly would it be in terms of the space like BFSI etc.?


A: Yes, we have been constantly looking out for some niche acquisitions which we have been doing right from the year 2003. US will be our focus for now because we have not done a large acquisition within US right from the year 2003. It was in 2004 that we had last acquired in the US space because we have been able to grow organically in that geography over a period of 10 to 12 years.

Other acquisitions have always been to improve our product and service offering in other areas. Now the focus would be to grow within US because we feel US is coming out of that deep recession and there is very visible demand, even if you look at our Q1 and Q2 results, our solutions and services practices (check) within the us space has grown significantly. We would like to add on to that now that we have de-risked our business model and US constitutes only 45% (check) of the revenue, now we feel is the right time to look at US as a space. Within USD 80-100 million, a topline companies is what we are looking within the US space. It would be primarily in the healthcare, life sciences and pharma space and also on the ERP space where we feel that we need to ramp up our offering on the SAP and the Oracle segment. It can be one large acquisition of USD 80-100 million or couple of smaller acquisitions of about USD 40-50 million. We have zeroed in on couple of companies, the due diligence process is yet to begin on that. That’s where we are currently standing.


Q2: So when might we hear more on the final acquisition?


A: Should be in the next four or five months. We are targeting to have it before 31st March. If we are lucky we will be able to do it. Otherwise, I think first quarter for next year we should be on track to close this out.


Q3: What about funding for this USD 80-100 million acquisition?


A: We have been always funding our acquisition by way of internal accruals and by way of debt from banks right from the year 2003. For this particular acquisition as well, we are going to have something the same strategy. But if we are able to have a good valuation at that point in time and if we feel that it is necessary to dilute equity at that point in time we will look at equity dilution aspect.


Q4: Currently your revenues from the US comprise of around 40% of your revenues. What then is the plan going forward? How much of a revenue share do you see US comprising of, may be 1 to 2 years down the line?


A: We are looking at about 15-20% kind of a growth coming from US alone in the next couple of years.


Q5: You have some fund raising approved, upto the tune of around Rs 400 crore. You said that this would be funded via internal accruals, debt. Any plans in terms of equity dilution, you touched upon it but in particular for this resolution that you currently have?


A: We had passed this enabling resolution for the last AGM for this Rs 400 crore, it can be by way of Foreign Currency Convertible Bond (FCCB) or a Global Depositary Receipt (GDR) or a Qualified Institutional Placement (QIP), depending on which instrument would be more ideal.


If the acquisition is not going to happen, we are not going to do this dilution at all. We have not diluted the equity right from our IPO days in 2007 and the last equity dilution happened was way back in the year 2000. So, we have been always got in the equity without diluting it to any extent. Not even a smaller extent. If incase the acquisition size is something very large and if it requires us to also have this instrument in place, in addition to the internal accruals and the debt, then we will be looking at that very closely.


Q6: Could you help us with your FY11 guidance for the revenues, profit figure and also perhaps an EPS? When would your acquisition get consummated in FY12?


A: We are on track to reach the topline of Rs 1750-1800 crore for FY11 which will be substantially higher to the Rs 979 crore topline that we clocked for FY10. At the profit level it is going to be anywhere between Rs 140-145 crore at the PAT level and at the EPS is going to be Rs 88-90. Looking at what we have achieved in Q1, Q2 and in Q3 and whatever is visible in Q4, we have a healthy pipeline and a healthy order book as well.


Order book stands at about USD 200 million. Pipeline is also something which we are working on for the next financial year. We are on track to achieving these things. Coming to FY12 estimate, I would say we should be growing at anywhere between 12-15% without acquisition and if we have the acquisition in place it should be much more. It should be closer to 25%.

Thursday, December 16, 2010

Zylog Targets $100M Acquisition


Business Daily from THE HINDU group of publications
Thursday, Dec 16, 2010
Article by T.E. Raja Simhan

Following the acquisition of Canada-based Brainhunter in February, Zylog Systems Ltd, the Chennai-based software company, plans to make another acquisition with a target size of nearly $100 million, according to the company's Global Chief Financial Officer, Mr S.P. Srihari.

“This does not mean that we will not look at a company that is in $50-million range. We will consider if it fits in to our radar,” he told Business Line.
The company is evaluating many candidates, including one in the US in the BFSI (banking, financial services and insurance) space that employs 1,500 people, he said. “We should close the deal in the next three months,” he said.
Mr Srihari said other than the BFSI, Zylog is looking at target companies present in sectors such as pharmaceutical and ERP. Grant Thornton, a professional services firm advising businesses that helped Zylog in previous acquisition, will be involved in the new one too, he said.

Mr S.P. Srihari

Brainhunter is key for Zylog

In February, Zylog acquired the Canada-based Brainhunter for Canadian $35 million (around Rs 150 crore) to offer consulting and engineering services in Canada. This company will now help Zylog double its revenue for fiscal 2010-11 to Rs 1,850 crore (Rs 979 crore in the last fiscal). Half of Zylog's revenues will come from Brainhunter, he said.

The acquisition of Brainhunter was done through the Company's Creditors Arrangement Act (CCAA) bidding process (in Canada) where Zylog emerged as the successful bidder.

A significant portion of Brainhunter's revenue is derived from the Federal Government of Canada.

It caters to Government departments, BFSI and telecom that are key focus segments for Zylog. Hence, there is high potential for cross-sell, he said.

Fund raising

Mr P. Srikanth, Executive Director, Zylog, said the company has the option to raise funds to the tune of Rs 400 crore by issue of securities/instruments in domestic/international markets. This includes equity shares/warrants with convertible or non-convertible debentures under qualified institutional placement or foreign currency convertible bonds or American depository receipts or global depository receipts.

Zylog's shareholders recently gave their consent to empower the board for the fund raising and enhance the limit from Rs 250 crore to Rs 400 crore, he said.

Sunday, November 28, 2010

John Mehrmann and Michael Moore Headline the Annual Conference for Society of Service Executives

Professional society in the technical services and support industry to feature workshops moderated by top executives at the Northern Illinois University Conference Center in Hoffman Estates, Illinois

Chicago, Illinois (POST) October 25, 2010 – Society of Service Executives gets attention by featuring industry experts from respected international technical service and support organizations.

John Mehrmann, CEO of Zylog Systems (Canada) Ltd, will present on technology trends and service return on investment. Having just received recognition as an InformationWeek 500 Top Technology Innovator, and the CRN Fast Growth 100, Zylog has earned a reputation as a thought leader for helping clients improve profitability with technology. John Mehrmann is author of the award winning book, The Trusted Advocate, Accelerate Success with Authenticity and Integrity.

Zylog Systems (Canada) Ltd acquired Brainhunter Inc in February 2010. Internationally ranked by the Top 100 Analysis of the Global Recruitment Consultant Industry, and one of the top professional staffing firms in Canada, Brainhunter dedication to developing career paths for consultants was promptly assimilated into the Zylog globally positioned workforce of software engineers and subject matter experts. Zylog develops and supports a broad range of industry specific and customer enterprise business applications through a proven delivery model that combines local consulting and delivery with highly scalable international development and testing facilities.

Michael Moore, Vice President of Supply Chain Services at DEX, will conduct a workshop on the Service Supply Chain for the Next Economy. This informative session will address a historical analysis of the service industry, the latest wave of service trends, and what this means for the future. Moore has more than 25 years of experience in the technology industry, procurement, component repair, client services, and reverse logistics.

The Annual Conference of the Society for Service Executives will be held on Wednesday, October 27, 2010 at the Northern Illinois University Conference Center in Hoffman Estates, Illinois. Dr. Bill Bleuel of Pepperdine University will be the keynote speaker.

Industry experts will share experiences and best practices for managing technical service and support. Workshops will be hosted by executives from Zylog, Fuji, Tellabs, DEX, and ACCO Brands.

Brainhunter Demonstrates Dramatic Economic Recovery in Canada

The Brainhunter rapid reversal of fortunes from years of recession and near bankruptcy to consistent economic growth and rising profitability are indicative of the economic recovery in Canada.

Toronto, Ontario (POST) October 25, 2010 – Zylog Systems (Canada) Ltd posts the second consecutive quarter of sustainable growth since the acquisition of Brainhunter.

Brainhunter Inc filed for protection under the Companies’ Creditors Arrangement Act and obtained an initial order on December 2, 2009. On February 17, 2010 Zylog Systems (Canada) ltd completed an asset purchase agreement with Brainhunter and other related entities whereby Brainhunter and such other entities agreed to sell, transfer and assign certain assets, including contracts, to Zylog Canada.

Since the asset purchase agreement in February, Zylog Systems (Canada) Ltd has consistently posted profitable monthly earnings, even as the organizations consolidated operations and completed transition to establish a solid foundation poised for future growth.

Recognizing the value of talented personnel, years of local knowledge, and long standing relationships with clients, Zylog Systems Canada retained substantially all of the employees of the company formerly known as Brainhunter. The employees were welcomed into the expanding group of Zylog companies worldwide and subsequently improved the financial position of the company at a pace that demonstrates the economic resiliency of Canada in the global community.

Internationally ranked by the Top 100 Analysis of the Global Recruitment Consultant Industry, and one of the top professional staffing firms in Canada, Brainhunter dedication to developing career paths for consultants was promptly assimilated into the Zylog globally positioned workforce of software engineers and subject matter experts. Zylog develops and supports a broad range of industry specific and customer enterprise business applications through a proven delivery model that combines local consulting and delivery with highly scalable international development and testing facilities.

Zylog earned prestigious recognition on the InformationWeek 500 List of Top Technology Innovators, and was once again recognized on the Everything Chanel CRN Fast Growth 100 List of top performing companies for consistent consecutive revenue growth of net sales.

In addition to professional staffing, Zylog expanding portfolio of solutions in Canada includes data migration, consolidation, virtualization, cloud computing, and replacement technology. Zylog solution architects specialize in migration from legacy applications, end of service life hardware, and expensive middleware to low cost open source alternatives. FieldPower Field Service Management, Silvanus360 software for recyclers, Greenlight prepress and graphic artwork production services, and consultant contract management with payroll processing represent a few of the combination of products and services currently available from Zylog in Canada.

Zylog Systems Canada Hosts CIO Summit in Toronto

CIO Summit in Toronto addresses dramatic changes in the roles of Chief Information Officers and Chief Technology Officers during a period of tumultuous economic transition.

Toronto, Ontario (POST) October 5, 2010 – Top executives gather to discuss the changing responsibilities of the CIO from economic constrictions to rapidly evolving strategic initiatives.

Economic challenges in recent years required executives to focus on cost cutting initiatives. As the changing economic conditions revitalize budgets in Canada, many CIOs and CTOs are faced with meeting the challenges of new technology, mergers, acquisitions, and customer expectations. New technology has emerged to reduce costs, improve productivity, collaborate with partners, and communicate with customers. The CIO summit, hosted by Zylog Systems Canada Ltd, presents an opportunity to share ideas and best practices.

“Zylog Systems Canada has a unique ability to address technology challenges,” said Shailendri Rana, Director of Business Development at Zylog Systems Canada Ltd. “As a solutions software developer with a world class research development center, complemented by one of the most respected staffing firms in Canada, Zylog provides both technology solutions and IT staffing for client internal requirements.”

The CIO Summit is being held at 66 Wellington Street West, 53rd Floor of the TD Center, Toronto, ON, Canada on 7 October.

Topics addressed by the CIO roundtable discussion include best practices for leveraging open source as a viable means to manage rising costs of license fees. Expert advisors review cloud computing, virtualization, consolidation, and the best practices for data migration as a means to reduce overhead, alleviate risk associated with end of service life hardware, and technology modernization. The outcome is designed to make business processes more efficient, introduce IT services for customers, get better intelligence to employees faster, and continue to lower IT costs.

The CIO Summit includes discussions regarding the acquisitions of SUN and WebLogic by Oracle, and individual company impact regarding license fees and hardware support. The rapid adoption of social media, enhanced functionality of mobile devices, and cloud security are also changing many technology requirements. The CIO summit provides an opportunity for peers to discuss individual views with leading authorities.

Software for Recyclers Manages Charitable Donations of Technology

Silvanus360 by Zylog helps recyclers and manufacturers easily donate useable equipment through the National Cristina Foundation. Benefits include tax deductions and double state collection credits.

New Orleans. Louisiana (POST) September 28, 2010 – Donations to non-profit organizations can generate financial benefits for recyclers, businesses, and manufacturers. Helping educational institutions, charities, and public agencies creates unexpected rewards.

The highest form of recycling is reuse. Reallocating retired products as charitable donations not only helps to keep electronic waste out of landfills, it also revitalizes local communities.

The National Cristina Foundation is a not for profit charity that enables used computers and related technology to be given a second productive life as a tool for developing human potential. The National Cristina Foundation has been a pioneer in technology reuse since 1985.

Thousands of prescreened organizations throughout the United States and Canada are registered in the Cristina Network as eligible to receive donations of computer and related technology. The Foundation’s donation management system enables non-profit community organizations, schools and public agencies to gain access to equipment donated in their local communities. The National Cristina Foundation does not charge any fees for its work or the technology that is distributed through the donation process.

Zylog integrated access to the Cristina Network in Silvanus360 software for recyclers. The integration enables recyclers to donate working computers and peripherals to thousands of local organizations across the United States and Canada.

Silvanus360 is comprehensive software for recyclers. Silvanus360 includes CRM, Order Management, Warehouse Management, Inventory, forms, and shipping in state-of-the-art software designed by recyclers for recyclers.

Silvanus360 includes a unique integrated solution for collectors to network with recyclers for end-to-end tracking. This unique capability enables identification of equipment from point of initial collection through the handling process, even when multiple companies are engaged, so recyclers can report on equipment from original source to ultimate donation destination.

The end-to-end tracking from source to donation available in Silvanus360 enables the recycler to report on initial source and destination. Some state regulations reward manufacturers with higher credit toward recycling targets based on rural collections. Some state regulations reward manufacturers with double credit to recycling targets for donations to educational institutions and non-profit organizations. Businesses donating working product to non-profit organizations may also be eligible for local tax credits. Recyclers using Silvanus360 have the ability to help local communities, reward partner manufacturers, and reward business clients.

Silvanus360 will be on display at E-Scrap. To find out more, please visit www.Silvanus360.com

Cali Resources Expands Recycling Capabilities with Advanced Tracking Software

The largest glass recycling and CRT processing facility in North America increases productivity and precision tracking with Silvanus360 state of the art software by Zylog.

San Diego, California (POST) September 24, 2010 – Advanced tracking software and ISO standard procedures improve performance and provide assurance for responsible recycling.

Cali Resources is the premier CRT and glass-to-glass processing facility in North America. By leveraging locations in San Diego, Tijuana, Calexico, and Mexicali, Cali Resources is able to provide the highest form of recycling at the lowest labor costs.

Cali Resources utilizes a million square foot facility to process the enormous volume received weekly from other recyclers nationwide. A former Thomson CRT Television Manufacturing Factory has been transformed into one of the largest CRT, Monitor, and Display Device dismantling and glass-to-glass processing facilities in the world. This enormous plant boasts a completely self-contained water treatment facility, fresh water tanks, electrical supply, 10k and 30k clean rooms, cafeteria, and lockers for employees.

As a pioneer for end-to-end tracking from point of collection to ultimate reuse of the CRTs and Display Devices, Cali Resources has collaborated with Zylog Systems Ltd to design and use software that supports ISO standards and complete transparency of this process for customers.



Silvanus360 by Zylog Systems Ltd provides a network framework to connect collectors with recyclers and downstream processors. The software enables tracking from point of collection, collection event logs, and consumer drop off through receiving, processing, and shipments for reuse. Silvanus360 provides enhanced visibility for business-to-business client tracking for responsible recycling and downstream management.

“When we installed Silvanus360 and modified our workflow, it was as if somebody unclogged the processes,” said Carlos Kelvin, President of Cali Resources. “We are able to accommodate all regulations and exceed customer expectations. Our improved performance resonates with our clients in the form of lower costs for processes that are enforced and visible.”

Carlos Kelvin, President of Cali Resources, has more than 15 years of experience providing full service recycling and asset recovery for electronic, electrical equipment, computers, storage devices, monitors, televisions, image display devices, and peripherals. Carlos has also been a featured speaker and noted panelist for best practices in recycling.

Silvanus360 by Zylog Systems Ltd is a comprehensive software solution that includes CRM, Order Management, Event Management, Dispatch, Receiving, Tear Down tracking, Attribute tracking, Warehouse Management, Process Control Management, Performance Reporting, and Shipping. Silvanus360 enables collectors and transportation vendors to collaborate with the recycler for end-to-end visibility and traceability. The simplified SKU management design allows the recycler to configure the application to the needs of the user.

Cali Resources and Zylog Systems Ltd will be demonstrating this powerful software at the E-Scrap Conference. Visitors to the conference will be able to see unique user interfaces that have been designed for optimum workflow management, including iPad, iPhone, and Netbook computers. Visitors will also be able to see the client monitoring with real time online updates.

Zylog Earns Prestigious Recognition on the InformationWeek 500 List of Top Technology Innovators

Value Added Research & Development and Eco-Friendly Computing places Zylog Systems Ltd among the Top 250 of the InformationWeek Technology Innovators.

Toronto, ON (POST) September 21, 2010 -- InformationWeek spotlights the power of innovation in information technology, rather than simply identifying the biggest spenders.


“For 22 years, the InformationWeek 500 has honored the most innovative users of business technology,” said InformationWeek Editor In Chief Rob Preston. “As we start to emerge from the worst recession in decades, the IT focus is now on driving growth—new sources of revenue, new relationships with customers, even new business models. This year’s ranking placed special emphasis on those companies and business technology executives leading that charge.”

Zylog Systems Ltd (ZSL Inc), a leading ISV and Global Systems Integrator, was recognized for Consulting and Business Services. Zylog is a pioneer in ‘Eco-Friendly’ computing solutions as a direct result of business aligned R&D and innovative ways to fusion the Cloud, Enterprise Mobile, and VDI technologies with Green IT initiatives.

As IT budgets are slightly alleviated from the cost cutting measures of one year ago, new trends are emerging to empower employees and utilize business intelligence. 72% of technology innovators are using wiki’s, blogs, and social networking to interact with customers, suppliers, and partners. Zylog offers a unique knowledge management suite developed on a Sharepoint platform to leverage integrated business intelligence, processes, blogs, wikis, and data mining.

InformationWeek identifies and honors the United States' most innovative users of information technology with its annual 500 listing and also tracks the technology, strategies, investments and administrative practices of America’s best-known companies.  Top winners have included:  CME Group, Conway, National Semiconductor, Kimberly-Clark, Hilton Hotels and Unum.  The InformationWeek 500 rankings are unique among corporate rankings as it spotlights the power of innovation in information technology, rather than simply identifying the biggest IT spenders.


Additional details on the InformationWeek 500 can be found online at
www.informationweek.com/iw500/ <http://www.informationweek.com/iw500/>


Zylog acquires Canada's Brainhunter

Zylog Systems Ltd (ZSL), a Chennai-based technology integrator and business solution provider, has acquired Canadian firm Brainhunter Inc, an IT consulting and engineering staffing services company. Zylog has spent C$35 million (around $32.76 million) for the acquisition, which will help to expand its footprint in Canada.

Brainhunter is engaged in consulting and engineering services in Canada with major presence in government, telecom, banking, financial services and insurance (BFSI), and oil and pipeline verticals, said a Zylog statement. The acquisition came through a bidding process for Brainhunter under the Canadian Creditors Arrangement Act (CCAA) in which Zylog put in the winning bid.

The acquisition will bring in Zylog’s fold Brainhunter's ready access to a large talent pool, over 1,400 contractors and more than 400 customers. The deal will also help Zylog save costs on account of offshoring contracts, sourcing of contractors from India for non government businesses and further reduction in non-billable staff, added the statement.

Speaking on the development, Sudarshan Venkatraman, Chairman and CEO, Zylog states that around 30% of the Brainhunter services rendered are to various agencies and departments of the Federal Government of Canada, and the company sees huge opportunity in the space. “Zylog has been looking to enter Canada for its operations and this acquisition would provide us with the appropriate platform. The target caters to government departments, BFSI, telecom which are the key focus segments for Zylog, and hence, there is high potential for cross-sell,” added Venkatraman.

Zylog offers a range of IT products and services to its global customers across multiple verticals like banking, insurance, telecom, etc. Its clientele includes SBI, American Express, Standard Chartered Bank, Allahabad Bank, ING Vysya among others