Post-Acquisition, Akibia Is Fully Assimilated
News | 18 Jun 2013
Three years after becoming part of an Indian company called Zensar Technologies, Westborough-based Akibia — which recently adopted its buyer's namesake — has been fully integrated into the company, said Ganesh Natarajan, CEO of Zensar. "This now a completely seamless operation," Natarajan said. Natarajan, who normally works out of India, was in Westborough last week, a trip he has made seven times a year since the $66-million acquisition. He and MetroWest-based Vivek Gupta, chief executive and head of global infrastructure management services, sat down with MetroWest495 Biz to discuss the company's expanded array of abilities post-Akibia acquisition, immigration reform and the local talent pool.
A Complementary Fit The firm formerly known as Akibia, which employs about 300 people in Westborough and Northborough, provides data center IT management services, including shipping, receiving, inventory control and repair, sometimes in windows as short as four hours. The Akibia operation, which officially changed its name to Zensar in April, have been a complementary addition for the Pune, India-based Zensar, which prior to 2010 positioned itself as software and services firm providing IT development, consulting and business process management. Natarajan said the resulting menu of products and services allows Zensar to cross-sell infrastructure management services to existing clients and applications and other services to infrastructure clients. He told analysts recently that about 40 percent of existing clients had either purchased infrastructure services from the company or were in talks to do so. "Once you support (IT infrastructure) as well, (customers) look at us as a single provider of all solutions pertaining to technology," Natarajan said. The company's customers are positioned across several industries, including banking, manufacturing, retail and health care. Gupta added: "A lot of osmosis has taken place between the teams. So it's no longer just infrastructure management as it probably was a couple years ago when it was Akibia." Infrastructure management provided about a third of Zensar's revenue last year, which was $368 million. The company counts many recognizable names among its customer base, including Framingham-based Bose, Marlborough-based Sunovion, Roche Bros. supermarkets, Colliers, Cisco and the Boston Red Sox. Zensar, which employs 7,500 around the world, including 850 in the United States, is owned by RPG Enterprises, an Indian industrial conglomerate that has holdings in tires, life sciences, travel and cell phone towers. Zensar trades on several Indian stock exchanges.
Visas Are Vital Zensar has about 300 customers in 140 countries, according to its latest financial filings. Having a global workforce means immigration is an important topic for the company, which employs what Natarajan calls a "dual-shore" model, meaning employees in India or another country might provide call center support or other services to a customer while the customer is also served by Zensar teams in the United States. Natarajan views the immigration discussions lately in Congress as promising. He wants to be able to move certain employees for months at a time to work on particular projects before moving back. "We're not saying let everyone come to America and become U.S. citizens," he said. While he said the available workforce in MetroWest is deep with tech talent, there are certain specialty areas, such as mobility software engineering, where Zensar has trouble filling roles. Natarajan said the company is looking to partner with an area community college to train people for the harder-to-fill roles, which he said might make up around 30 or 40 percent of the positions in MetroWest. "If we found a college training Cisco-certified engineers, we would supplement with a two-to-three-month intensive program," he said.
Getting To $1 Billion Akibia has Zensar part way to its revenue goal of $1 billion, which it recently said it hopes to reach in 2017. Natarajan said on a recent call with analysts that getting there will take another acquisition. The company is eying something in the range of $30 million to $50 million, he said. But in the meantime, Zensar is growing. Its revenue has grown 87 percent over the past three fiscal years. Profits for 2012 were $30.1 million.