"As applications become more complex, testing is going to be the need of the hour, while the sector which is growing about 45 percent annually among the various verticals of application development faces shortages of trained testers," said Neelam Dhawan, Managing Director, HP India. Blaming Indian IT education system which follows the curriculum that is not subjected to upgradation frequently, Neelam opines that Indian institutes fail to produce graduates who are updated with latest trends in technology.
Intending to fill the gap between education and employability and help the graduates to become well trained software testing professionals, HP, one of the testing majors has launched HP Software University (HPSU) in partnership with Indian Institute of Hardware Technology (IIHT).
The first of its kind program from HP will offer students accredited training on HP software and a curriculum path surrounding various testing software from HP like Quick Test professional and LoadRunner. Certified professionals would gain access to special HP software online resources providing the latest in software news, product information, job openings and more.
Software testing is a $13 billion market globally today and India is expected to contribute 70 percent of this. "Keeping in mind the tremendous market for software testing tools, we have partnered with HP and with program our students will be equipped with unique skills that will benefit and make them more marketable," said Keshava Raju, CEO, IIHT.
As per the estimates India is currently facing a shortage of 18,000 software testers and it may grow to 25,000 in the coming years. HP is eying to fill this gap by setting up training centers in Mumbai, Delhi, Pune, Kolkata, Hyderabad, Noida, Chennai and Bangalore. The company has plans to extend the program to more cities over the next few months.
Showing posts with label HP. Show all posts
Showing posts with label HP. Show all posts
Friday, March 20, 2009
Thursday, March 19, 2009
Coke contract and employees move from Satyam to HP
Satyam has lost soft drink maker Coca-Cola’s ERP contract to the world’s second largest technology services provider HP, according to sources close to the development. While reports of the troubled software firm losing clients are not new, what is new this time is that the company has now lost a contract with attachment- employees.
Apart from bagging the ERP contract from Coca-Cola, HP has also issued offer letters to Satyam employees who were working with the client. Some of these employees will be joining HP next month. It is believed that Satyam had at least 100 employees working on the Coca-Cola project in its Chennai offshore development centre. Most of them were experts in the area of SAP consulting and implementation.
When contacted, Coca-Cola did not wish to comment, HP did not respond. A Satyam spokesperson said, “We do not comment on speculative reports and especially matters which are pertaining to our customer relationships.”
But, senior employees working with Satyam and HP confirmed the development and said the contract transfer had happened in the last few weeks. Its been known for quite a few months now that Coca-Cola has been transferring its technology services contract from Satyam to other vendors. It was recently reported that Coke had selected Capgemini to implement finance and accounting functions.
“Satyam has traditionally partnered with bigger technology firms for sub-contracted work to get big customer accounts. It has also done sub-contracting work for Capgemini and HP, so there is some uncertainty about how these projects will get executed,” said an industry official who did not wish to be named.
While the overall size of Coca-Cola’s contract is $100 million for a period of seven years, industry sources said the ERP piece alone would have fetched Satyam $3.5-$4 million annually. Coca-Cola outsourced the ERP or enterprise resource planning function to manage its distribution globally. Among the IT majors in India, Satyam was considered to be the leader in ERP, a vertical from which it used to earn at least half of its revenues.
But, the expertise that it has built for years is not helping the beleaguered keep all its clients intact, after the firm’s founder Ramalinga Raju confessed to falsifying accounts and perpetrating a Rs 7,000 crore fraud in January this year. The company is currently in the process of selling a majority stake that will help the company regain some confidence among its clients and employees.
Apart from bagging the ERP contract from Coca-Cola, HP has also issued offer letters to Satyam employees who were working with the client. Some of these employees will be joining HP next month. It is believed that Satyam had at least 100 employees working on the Coca-Cola project in its Chennai offshore development centre. Most of them were experts in the area of SAP consulting and implementation.
When contacted, Coca-Cola did not wish to comment, HP did not respond. A Satyam spokesperson said, “We do not comment on speculative reports and especially matters which are pertaining to our customer relationships.”
But, senior employees working with Satyam and HP confirmed the development and said the contract transfer had happened in the last few weeks. Its been known for quite a few months now that Coca-Cola has been transferring its technology services contract from Satyam to other vendors. It was recently reported that Coke had selected Capgemini to implement finance and accounting functions.
“Satyam has traditionally partnered with bigger technology firms for sub-contracted work to get big customer accounts. It has also done sub-contracting work for Capgemini and HP, so there is some uncertainty about how these projects will get executed,” said an industry official who did not wish to be named.
While the overall size of Coca-Cola’s contract is $100 million for a period of seven years, industry sources said the ERP piece alone would have fetched Satyam $3.5-$4 million annually. Coca-Cola outsourced the ERP or enterprise resource planning function to manage its distribution globally. Among the IT majors in India, Satyam was considered to be the leader in ERP, a vertical from which it used to earn at least half of its revenues.
But, the expertise that it has built for years is not helping the beleaguered keep all its clients intact, after the firm’s founder Ramalinga Raju confessed to falsifying accounts and perpetrating a Rs 7,000 crore fraud in January this year. The company is currently in the process of selling a majority stake that will help the company regain some confidence among its clients and employees.
HP cuts salaries of EDS employees by 10%
Hewlett-Packard Co said it will cut the base salaries of some employees in its EDS business by 10 per cent for the month of April. The temporary salary reduction is in addition to a company-wide pay cut HP instituted last month.
The salary cut impacts only EDS workers based in the United States and Puerto Rico and will not affect those making less than $40,000.
A company spokeswoman said in a statement via email that the move is a "temporary cost action to keep the organization strong while increasing financial flexibility."
HP bought EDS last year for $13.2 billion. Last month, after the company cut its full-year outlook and posted weaker-than expected quarterly revenue, HP moved to reduce base pay for all its employees, including a 5 per cent cut for most salaried workers.
HP Chief Executive Mark Hurd has stressed the company's commitment to lowering costs. HP is the world's largest maker of personal computers, and second-largest technology services company.
The salary cut impacts only EDS workers based in the United States and Puerto Rico and will not affect those making less than $40,000.
A company spokeswoman said in a statement via email that the move is a "temporary cost action to keep the organization strong while increasing financial flexibility."
HP bought EDS last year for $13.2 billion. Last month, after the company cut its full-year outlook and posted weaker-than expected quarterly revenue, HP moved to reduce base pay for all its employees, including a 5 per cent cut for most salaried workers.
HP Chief Executive Mark Hurd has stressed the company's commitment to lowering costs. HP is the world's largest maker of personal computers, and second-largest technology services company.
Monday, March 16, 2009
HP imposes more salary cuts for EDS employees
HP said late Friday afternoon that it was temporarily cutting base salaries for EDS employees by an additional 10 percent beyond what was announced last month. On February 18, the company said it was cutting base pay across the board and making adjustments to benefit plans as part of a cost-cutting measure.
Below is the full text of today’s memo to employees, obtained by ZDNet:
From: EDS Worldwide Marketing - Communications
Sent: Friday, March 13, 2009 4:05 PM
Subject: Additional, Temporary Compensation Adjustments for EDS U.S. & Puerto Rico Employees
To EDS Business Unit Employees in the United States and Puerto Rico:
Since becoming part of HP last year, we have accomplished a great deal and should be proud of what we have delivered together. Our service excellence remains high, and we have closed a number of significant deals. Our execution during the transition phase has been outstanding. As we move from the integration phase into the transformation phase, we know from experience with our own client projects this will be the most difficult part of our journey.
Our goal is to transform the business into a future state, which will grow faster than the market and enable us to take share from our competitors. We will then be able to deliver above-industry benchmark returns to our shareholders and price deals that win more business while providing flexibility to invest in innovation, delivering greater value to our clients.
The gap between where we are today and accomplishing our goals is widened by the current economic climate. As a result, we need to take temporary actions to get us through this difficult period. Our customers expect EDS to be a financially strong partner and, as employees, we expect a healthy company as well. With this in mind, we announced specific actions on March 9 to reduce our cost structure and enable the business to improve operating profit and grow as we enter fiscal year 2010.
Unfortunately, we need to take additional action. Specifically, we have decided to make a temporary, additional reduction in base salary affecting EDS business unit employees in the United States and Puerto Rico.
Base salaries for all United States and Puerto Rico employees in the EDS business unit will be temporarily reduced beyond those reductions previously announced by HP on February 18, as follows:
* An additional, temporary reduction of 10 percent in base salary effective for April 2009
* Base salary will not be reduced for employees below an annualized, full-time equivalent income of $40,000 by this additional, temporary action
In May 2009, base salary for United States and Puerto Rico employees in the EDS business unit will be reinstated to the levels of base salary effective on March 16. This includes reductions previously outlined in HP’s February 18 announcement. While we have no plans for an additional base salary reduction, we will continue to closely monitor the performance of our business and make further adjustments as required in the coming months.
We recognize these are tough actions, and you can be assured we made this decision after much thought and assessment. We ask for your support and understanding as we work through these very difficult times. We are confident we will strengthen our position in a consolidating market. We will be one of the industry’s strongest and safest pairs of hands, trusted by our clients to solve their technology challenges.
Sincerely,
The EDS Senior Leadership Team
Below is the full text of today’s memo to employees, obtained by ZDNet:
From: EDS Worldwide Marketing - Communications
Sent: Friday, March 13, 2009 4:05 PM
Subject: Additional, Temporary Compensation Adjustments for EDS U.S. & Puerto Rico Employees
To EDS Business Unit Employees in the United States and Puerto Rico:
Since becoming part of HP last year, we have accomplished a great deal and should be proud of what we have delivered together. Our service excellence remains high, and we have closed a number of significant deals. Our execution during the transition phase has been outstanding. As we move from the integration phase into the transformation phase, we know from experience with our own client projects this will be the most difficult part of our journey.
Our goal is to transform the business into a future state, which will grow faster than the market and enable us to take share from our competitors. We will then be able to deliver above-industry benchmark returns to our shareholders and price deals that win more business while providing flexibility to invest in innovation, delivering greater value to our clients.
The gap between where we are today and accomplishing our goals is widened by the current economic climate. As a result, we need to take temporary actions to get us through this difficult period. Our customers expect EDS to be a financially strong partner and, as employees, we expect a healthy company as well. With this in mind, we announced specific actions on March 9 to reduce our cost structure and enable the business to improve operating profit and grow as we enter fiscal year 2010.
Unfortunately, we need to take additional action. Specifically, we have decided to make a temporary, additional reduction in base salary affecting EDS business unit employees in the United States and Puerto Rico.
Base salaries for all United States and Puerto Rico employees in the EDS business unit will be temporarily reduced beyond those reductions previously announced by HP on February 18, as follows:
* An additional, temporary reduction of 10 percent in base salary effective for April 2009
* Base salary will not be reduced for employees below an annualized, full-time equivalent income of $40,000 by this additional, temporary action
In May 2009, base salary for United States and Puerto Rico employees in the EDS business unit will be reinstated to the levels of base salary effective on March 16. This includes reductions previously outlined in HP’s February 18 announcement. While we have no plans for an additional base salary reduction, we will continue to closely monitor the performance of our business and make further adjustments as required in the coming months.
We recognize these are tough actions, and you can be assured we made this decision after much thought and assessment. We ask for your support and understanding as we work through these very difficult times. We are confident we will strengthen our position in a consolidating market. We will be one of the industry’s strongest and safest pairs of hands, trusted by our clients to solve their technology challenges.
Sincerely,
The EDS Senior Leadership Team
Friday, March 6, 2009
MphasiS to convert fixed costs into variable
No salary cuts yet, but can’t say what will happen three months ahead, says CEO. IT and BPO service provider, MphasiS, is looking to convert more of its fixed costs into variable ones to cope with the current economic downturn.
While it is yet to finalise the areas, staff pay and infrastructure seem to be the likely places to begin. “When the times are uncertain, we want cost variability to be higher than the usual. Our focus will be to ensure our financials continue to stay healthy,” said Ganesh Ayyar, CEO.
In the wake of the global financial meltdown, many IT services’ companies have announced that the variable component of pay will be affected. This part is linked with the company’s revenue and operating margin, and varies from 20-50 per cent of salary, based on seniority.
MphasiS employs about 30,000 people across all its businesses, including BPO operations; it says there has been no cut in any salary. But can’t commit on plans for the near future.
“We will see how the market pans out, and if the situation really gets that bad, we will revisit that decision. But nobody can make a prediction of what is going to happen three to six months down the road,” said Ayyar, who joined MphasiS after over 20 years of service with HP.
According to MphasiS’ (interim) Chief Financial Officer, Susanto Banerjee, the company has already been working to so convert its fixed costs, “progressively over the quarters.” And is looking at fixed costs involving infrastructure. “We are thinking of having our future infrastructure on pay-per-use basis,” he said.
MphasiS’ revenue was Rs 978 crore in the quarter ending January 31, and its general and administrative expenses stood at Rs 67.3 crore, an increase of 17 per cent over the quarter ending October 31, 2008. As a percentage of revenues, these expenses increased marginally to 6.9 per cent in that quarter from 6.4 per cent in the previous one. “We are looking at some of these costs, which give us flexibility in operations,” said Banerjee.
The company added 1,193 people in the previous quarter, including 574 freshers; taking more of the latter for transaction-based projects is likely, Ayyar said, depending upon the project mix. “We are going to campuses for freshers because that’s an investment we want to make for our future business, and that’s where we can build a competitive cost structure.”
Source: BusinessStandard
While it is yet to finalise the areas, staff pay and infrastructure seem to be the likely places to begin. “When the times are uncertain, we want cost variability to be higher than the usual. Our focus will be to ensure our financials continue to stay healthy,” said Ganesh Ayyar, CEO.
In the wake of the global financial meltdown, many IT services’ companies have announced that the variable component of pay will be affected. This part is linked with the company’s revenue and operating margin, and varies from 20-50 per cent of salary, based on seniority.
MphasiS employs about 30,000 people across all its businesses, including BPO operations; it says there has been no cut in any salary. But can’t commit on plans for the near future.
“We will see how the market pans out, and if the situation really gets that bad, we will revisit that decision. But nobody can make a prediction of what is going to happen three to six months down the road,” said Ayyar, who joined MphasiS after over 20 years of service with HP.
According to MphasiS’ (interim) Chief Financial Officer, Susanto Banerjee, the company has already been working to so convert its fixed costs, “progressively over the quarters.” And is looking at fixed costs involving infrastructure. “We are thinking of having our future infrastructure on pay-per-use basis,” he said.
MphasiS’ revenue was Rs 978 crore in the quarter ending January 31, and its general and administrative expenses stood at Rs 67.3 crore, an increase of 17 per cent over the quarter ending October 31, 2008. As a percentage of revenues, these expenses increased marginally to 6.9 per cent in that quarter from 6.4 per cent in the previous one. “We are looking at some of these costs, which give us flexibility in operations,” said Banerjee.
The company added 1,193 people in the previous quarter, including 574 freshers; taking more of the latter for transaction-based projects is likely, Ayyar said, depending upon the project mix. “We are going to campuses for freshers because that’s an investment we want to make for our future business, and that’s where we can build a competitive cost structure.”
Source: BusinessStandard
HP-EDS wins $1 billion deal with Aviva
Hewlett-Packard (NYSE: HPQ) subsidiary EDS (NYSE: EDS) said Monday that it won a $1 billion contract to provide a range of tech services to insurance giant Aviva. Under the 10-year deal, EDS will help Aviva manage and transform two data centers in Norwich, England. The data centers serve Aviva's operations in the United Kingdom, India, France, and Ireland.
"Partnering with EDS for data center services, in our view, supports Aviva's goals to improve flexibility, increase operational efficiency, and lower costs," Igal Mayer, Aviva's CEO for U.K. general insurance, said in a statement.
Mayer said Aviva selected EDS "after a thorough evaluation" of the IT service provider field.
EDS will provide the insurer with data center modernization services and help the company manage its mainframe, midrange, and Windows servers. 300 Aviva IT workers will transfer to EDS as part of the arrangement.
"The data center transformation will help Aviva increase efficiency, lower risks, and reduce costs," said Bill Thomas, EDS's senior VP for Europe, the Middle East, and Africa.
HP acquired EDS in August 2008 in a deal valued at $13.9 billion. Since then, the company has signed 16 major outsourcing contracts with a range of customers, including Medicare Administrative Services, the Phoenix Companies, the United States Department of Defense, Virgin Atlantic, and Sara Lee.
HP acquired EDS with an eye to growing its footprint in the market for global IT services after previous efforts stalled.
"Partnering with EDS for data center services, in our view, supports Aviva's goals to improve flexibility, increase operational efficiency, and lower costs," Igal Mayer, Aviva's CEO for U.K. general insurance, said in a statement.
Mayer said Aviva selected EDS "after a thorough evaluation" of the IT service provider field.
EDS will provide the insurer with data center modernization services and help the company manage its mainframe, midrange, and Windows servers. 300 Aviva IT workers will transfer to EDS as part of the arrangement.
"The data center transformation will help Aviva increase efficiency, lower risks, and reduce costs," said Bill Thomas, EDS's senior VP for Europe, the Middle East, and Africa.
HP acquired EDS in August 2008 in a deal valued at $13.9 billion. Since then, the company has signed 16 major outsourcing contracts with a range of customers, including Medicare Administrative Services, the Phoenix Companies, the United States Department of Defense, Virgin Atlantic, and Sara Lee.
HP acquired EDS with an eye to growing its footprint in the market for global IT services after previous efforts stalled.
Saturday, February 28, 2009
MphasiS: strong results, weak market valuation
Information technology (IT) services provider MphasiS Ltd, owned by Hewlett-Packard Co. (HP), has reported strong results for the quarter ended January, defying the slowdown which caused most IT firms to report weak numbers for the December quarter.
MphasiS follows the November-October fiscal year to align with the practice followed at HP. Revenues grew by a strong 9.3% sequentially and net profit rose by nearly 15% between the three months to January, much higher than the low single-digit growth rates most IT firms reported for the December quarter.
The secret to MphasiS’ success lies in its parentage. HP and its services arm EDS outsource some of their work to MphasiS to cut costs. While software services work coming to the HP group has been affected owing to the slowdown, this hasn’t impacted the work flow pushed down to MphasiS because of the large difference in the size of the two firms.
The HP group reported services revenues of $8.75 billion (Rs44,362 crore) in the January quarter, while MphasiS’ revenues stood at around $200 million. Now, MphasiS derives 45% of its revenues from work pushed down by HP. This amounts to just about 1% of HP’s total services revenues. Even if, for arguement’s sake, HP’s services revenues fall by half owing to the slowdown, the quarterly revenues of around $100 MphasiS derives from HP is hardly at risk. HP contributed to 40% of revenues till October, which indicates its contribution has grown in the last quarter.
It’s not that all the credit of MphasiS’ better-than-industry performance goes to HP. The company has done well to contain costs and take full advantage of the depreciation in the rupee. According to the company’s chief financial officer, Susanto Banerjee, in the past year the company has improved employee utilization, pulled back on travel, and invested in sales and marketing.
But it’s clear that it doesn’t make sense to infer from MphasiS’ results that the IT industry isn’t in trouble. MphasiS’ business model is unique because of the work it gets from HP. Still, the market has valued it at only around 4.5 times annualized earnings for the January quarter.
MphasiS follows the November-October fiscal year to align with the practice followed at HP. Revenues grew by a strong 9.3% sequentially and net profit rose by nearly 15% between the three months to January, much higher than the low single-digit growth rates most IT firms reported for the December quarter.
The secret to MphasiS’ success lies in its parentage. HP and its services arm EDS outsource some of their work to MphasiS to cut costs. While software services work coming to the HP group has been affected owing to the slowdown, this hasn’t impacted the work flow pushed down to MphasiS because of the large difference in the size of the two firms.
The HP group reported services revenues of $8.75 billion (Rs44,362 crore) in the January quarter, while MphasiS’ revenues stood at around $200 million. Now, MphasiS derives 45% of its revenues from work pushed down by HP. This amounts to just about 1% of HP’s total services revenues. Even if, for arguement’s sake, HP’s services revenues fall by half owing to the slowdown, the quarterly revenues of around $100 MphasiS derives from HP is hardly at risk. HP contributed to 40% of revenues till October, which indicates its contribution has grown in the last quarter.
It’s not that all the credit of MphasiS’ better-than-industry performance goes to HP. The company has done well to contain costs and take full advantage of the depreciation in the rupee. According to the company’s chief financial officer, Susanto Banerjee, in the past year the company has improved employee utilization, pulled back on travel, and invested in sales and marketing.
But it’s clear that it doesn’t make sense to infer from MphasiS’ results that the IT industry isn’t in trouble. MphasiS’ business model is unique because of the work it gets from HP. Still, the market has valued it at only around 4.5 times annualized earnings for the January quarter.
Tuesday, February 24, 2009
HP Posts Declines in All Groups but EDS
Despite declines nearly across the board, Hewlett-Packard just barely managed an increase in revenue for the first quarter of 2009, which ended Jan. 31, the company announced Wednesday. Net revenue for the quarter reached US$28.8 billion, up 1 percent compared to the same period last year. HP Software revenue was down 7 percent to $878 million and HP Financial Services revenue decreased 1 percent to $636 million.
Net income was $1.9 billion, or $0.75 earnings per share, down from $2.1 billion, or $0.80 earnings per share. On a pro forma basis, which excludes certain one-time items, net income came in at $2.3 billion, the same as in the first quarter of 2008, although earnings per share rose to $0.93 from $0.86. Without strong growth in its Services group, HP would have fared much worse. Revenue for that group grew 116 percent to $8.7 billion, primarily due to HP's acquisition of EDS.
Net income was $1.9 billion, or $0.75 earnings per share, down from $2.1 billion, or $0.80 earnings per share. On a pro forma basis, which excludes certain one-time items, net income came in at $2.3 billion, the same as in the first quarter of 2008, although earnings per share rose to $0.93 from $0.86. Without strong growth in its Services group, HP would have fared much worse. Revenue for that group grew 116 percent to $8.7 billion, primarily due to HP's acquisition of EDS.
HP imposes staff wage cuts
Source: The Register
Hewlett-Packard workers fired up their PCs Friday morning to find a long memo from Mark Hurd explaining why he was imposing wide-ranging pay cuts in an effort to prevent further job losses at the computer vendor.
HP CEO Hurd told employees yesterday that no more jobs would be axed for the foreseeable future. Instead he applied salary reductions across the board.
Executive council members will have base pay trimmed by 15 per cent; other execs will see base pay reduced by 10 per cent; “exempt employees” base salary takes a five per cent hit; and “non-exempt employees” base pay drops 2.5 per cent.
Hewlett-Packard workers fired up their PCs Friday morning to find a long memo from Mark Hurd explaining why he was imposing wide-ranging pay cuts in an effort to prevent further job losses at the computer vendor.
HP CEO Hurd told employees yesterday that no more jobs would be axed for the foreseeable future. Instead he applied salary reductions across the board.
Executive council members will have base pay trimmed by 15 per cent; other execs will see base pay reduced by 10 per cent; “exempt employees” base salary takes a five per cent hit; and “non-exempt employees” base pay drops 2.5 per cent.
Friday, February 20, 2009
HP to Cut Salaries of All Employees, Executives
Palo Alto, Calif. - Attempting to avoid massive layoffs in the face of the ongoing recession, Hewlett-Packard (HP) (NYSE: HPQ) has announced pay cuts for all of its employees.
CEO Mark Hurd will take a 20% cut, members of the executive council 15%, other executives 10% and all other employees 5%.
The company, which late Wednesday announced a 13% drop in quarterly earnings, also plans to implement changes in its 401(K) and share ownership plans.
"At a company-wide level, I don't believe a major workforce reduction is the best thing for HP at this time," Hurd wrote, in a memo to employees obtained by AllThingsD.
"But we do have to do something...because the numbers just don't add up and we need to have the flexibility to make the right long-term investments for HP."
Hurd said that if the company performs better than expected, the reductions potentially could be made up in bonuses.
CEO Mark Hurd will take a 20% cut, members of the executive council 15%, other executives 10% and all other employees 5%.
The company, which late Wednesday announced a 13% drop in quarterly earnings, also plans to implement changes in its 401(K) and share ownership plans.
"At a company-wide level, I don't believe a major workforce reduction is the best thing for HP at this time," Hurd wrote, in a memo to employees obtained by AllThingsD.
"But we do have to do something...because the numbers just don't add up and we need to have the flexibility to make the right long-term investments for HP."
Hurd said that if the company performs better than expected, the reductions potentially could be made up in bonuses.
Thursday, February 12, 2009
Mass layoff in HP ProCurve project??
Hewlett-Packard Company has announced today it’s plans to lay off all network engineers-contractors from it’s ProCurve project in Roseville, CA (Sacramento area). Dozens of engineers are affected, according to leaks from different anonymous sources from inside.
Wednesday, December 31, 2008
Satyam Crisis[update]: Possible takeovers
Satyam Computer is understood to have grabbed the attention of private equity investors, rival IT firms and other institutional investors, which are looking at the IT major as a possible takeover target with attractive valuations.
Satyam Computers is available at a bargain:
Though the company looks attractive, the three top Indian IT services companies are unlikely to bite. According to market sources, the Big 3: TCS, Infosys and Wipro are most definitely not going to make a bid for Satyam. The reasons are simple. The foremost being acquiring Satyam would be "more of the same." Same suite of businesses, technologies and clients. Market participants also believe that considering the cash one would have to fork out, the only thing assured are 53,000 employees. The big 3 don't necessarily want those number of additional people at the moment.
While there has been market speculation that IBM or Accenture might emerge as strategic buyers, the general perception within the industry seem to be that they might also stay out. Both the companies have hugely grown their local operations and today have 74,000 IBM) and 37,000 (Accenture) employees in India. Adding more people through acquisition might not be a priority while they can be grown organically especially in the current environment where quality people are available at reasonable prices.
Satyam for Cash:
A controlling 26% stake in the company can be acquired for $520-million, given that the company's market cap is around $2-billion. Then, of course, the cherry on the cake: $1.2-billion in cash.
Cognizant interested in Satyam?
As speculation mounts on who could be a potential ‘buyer' of Satyam Computer Services, the one name repeatedly touted as a very interested party is Cognizant Technologies. The Teaneck, New Jersey-based, Nasdaq-listed company with a huge India back-end has not hid its ambitions of wanting to be in the big league. The company that has clocked very aggressive top line growth in the last few years grew 50% in 2007 with revenues at $2.13 billion.
If it were to buy Satyam which had revenues of $2.14-billion last fiscal, then Cognizant with has 59,000 employees would easily pip Wipro to emerge as the third largest IT services company. Wipro's IT services business closed last fiscal with a topline of $3.41-billion. Cognizant and Satyam with combined revenues in excess of $4-billion would easily move Wipro to the fourth slot among the top Indian IT service providers. When contacted Cognizant Technologies' spokesperson R Ramkumar, said, "As a policy, we do not comment on market speculation."
Among the big IT players, analysts say Cognizant is likely to gain the most if it acquires Satyam as the deal will give it scale, an opportunity to diversify from concentrations such as banking, financial services and pharmaceuticals and access to a robust SAP business.
Is Hewlett-Packard eyeing stake in Satyam?
BANGALORE: Hewlett-Packard (HP) is evaluating the possibility of acquiring a stake in IT services provider Satyam Computer, attracted by the latter’s lucrative business software practice. The opportunity to challenge rival IBM with bigger, low-cost offshore capabilities is also alluring, those familiar with the strategic options being considered by the company said.
More:
Raju tells Satyam staffers to stand by him. Letter to all Satyam Employees.
Satyam Computers is available at a bargain:
Though the company looks attractive, the three top Indian IT services companies are unlikely to bite. According to market sources, the Big 3: TCS, Infosys and Wipro are most definitely not going to make a bid for Satyam. The reasons are simple. The foremost being acquiring Satyam would be "more of the same." Same suite of businesses, technologies and clients. Market participants also believe that considering the cash one would have to fork out, the only thing assured are 53,000 employees. The big 3 don't necessarily want those number of additional people at the moment.
While there has been market speculation that IBM or Accenture might emerge as strategic buyers, the general perception within the industry seem to be that they might also stay out. Both the companies have hugely grown their local operations and today have 74,000 IBM) and 37,000 (Accenture) employees in India. Adding more people through acquisition might not be a priority while they can be grown organically especially in the current environment where quality people are available at reasonable prices.
Satyam for Cash:
A controlling 26% stake in the company can be acquired for $520-million, given that the company's market cap is around $2-billion. Then, of course, the cherry on the cake: $1.2-billion in cash.
Cognizant interested in Satyam?
As speculation mounts on who could be a potential ‘buyer' of Satyam Computer Services, the one name repeatedly touted as a very interested party is Cognizant Technologies. The Teaneck, New Jersey-based, Nasdaq-listed company with a huge India back-end has not hid its ambitions of wanting to be in the big league. The company that has clocked very aggressive top line growth in the last few years grew 50% in 2007 with revenues at $2.13 billion.
If it were to buy Satyam which had revenues of $2.14-billion last fiscal, then Cognizant with has 59,000 employees would easily pip Wipro to emerge as the third largest IT services company. Wipro's IT services business closed last fiscal with a topline of $3.41-billion. Cognizant and Satyam with combined revenues in excess of $4-billion would easily move Wipro to the fourth slot among the top Indian IT service providers. When contacted Cognizant Technologies' spokesperson R Ramkumar, said, "As a policy, we do not comment on market speculation."
Among the big IT players, analysts say Cognizant is likely to gain the most if it acquires Satyam as the deal will give it scale, an opportunity to diversify from concentrations such as banking, financial services and pharmaceuticals and access to a robust SAP business.
Is Hewlett-Packard eyeing stake in Satyam?
BANGALORE: Hewlett-Packard (HP) is evaluating the possibility of acquiring a stake in IT services provider Satyam Computer, attracted by the latter’s lucrative business software practice. The opportunity to challenge rival IBM with bigger, low-cost offshore capabilities is also alluring, those familiar with the strategic options being considered by the company said.
More:
Raju tells Satyam staffers to stand by him. Letter to all Satyam Employees.
Thursday, September 18, 2008
HP set to cut workforce by 24,600
Forwarded by Venkat!
Hewlett-Packard (HP), the world’s largest computer company, says it plans to cut 24,600 jobs, almost 8% of its workforce, to streamline its business.
The cuts will take place over the next three years as it combines operations with Electronic Data Systems, the technology company it recently bought.
EDS employees are expected to bear the brunt of the cuts
HP hopes the acquisition will allow it to take on rival IBM and win more lucrative, long-term contracts.
Half of the jobs cuts will be in the US, with finance, human resources and legal departments expected to be affected.
The company said that it eventually planned to add about half the positions back as different jobs in different departments within the company.
HP’s $13.9bn takeover of EDS is the firm’s biggest acquisition since 2002 when it bought Compaq for $19bn.
Hewlett-Packard (HP), the world’s largest computer company, says it plans to cut 24,600 jobs, almost 8% of its workforce, to streamline its business.
The cuts will take place over the next three years as it combines operations with Electronic Data Systems, the technology company it recently bought.
EDS employees are expected to bear the brunt of the cuts
HP hopes the acquisition will allow it to take on rival IBM and win more lucrative, long-term contracts.
Half of the jobs cuts will be in the US, with finance, human resources and legal departments expected to be affected.
The company said that it eventually planned to add about half the positions back as different jobs in different departments within the company.
HP’s $13.9bn takeover of EDS is the firm’s biggest acquisition since 2002 when it bought Compaq for $19bn.
Subscribe to:
Posts (Atom)