May 25, 2011

KPIT Cummins takes 50% stake in SYSTIME

Pune – KPIT Cummins Infosystems Ltd (BSE: 532400; NSE: KPIT), a global IT consulting and engineering partner to manufacturing and Energy & Utilities corporations, and SYSTIME, a leading business technology service provider, today announced that KPIT Cummins has entered into a definitive agreement to take 50% stake in SYSTIME, world's largest JD Edwards solution provider.

Strategic Rationale – A symbiotic partnership
Both KPIT Cummins and SYSTIME have a similar strategy of sharply focusing on select industries and achieving market leadership by creating best in class practices/offerings that help customers achieve their growth and profitability objectives. With this partnership the combined Oracle practice will be over USD 125 million for FY12.

What does this partnership mean to KPIT Cummins:

- Strengthens position as integrated solutions’ partner to Manufacturing and Energy & Utilities industries: The association is aligned to the company’s strategy of serving customers in the Manufacturing and Energy & Utilities industries, where JD Edwards (JDE) has been a leader. Oracle’s JDE Enterprise One is an integrated suite of comprehensive enterprise resource planning software that enables rapid deployment and ease of administration with low total cost of ownership. The worldwide installed base of JDE is estimated around 5000+ customers, many of which are Fortune 500 companies.
- Underscores strong focus on providing Oracle based consulting, solutions and services: This partnership is aligned to KPIT Cummins’ vision of offering ‘ERP surround’ solutions and services using Oracle products (Demantra/VCP, OBIEE, Hyperion, Siebel, OTM, Agile PLM, etc) and integration tools like Oracle Fusion Middleware (OFM). This partnership will add capabilities in providing solutions and services in JDE ERP and Hyperion space, to KPIT Cummins’ portfolio. Addition of 600+ JDE and 200+ Oracle Technology practitioners from SYSTIME will make this a 2000+ strong combined practice.
- Reinforces leadership in Oracle consulting space: SYSTIME, an Oracle Platinum partner, has been identified by the independent research firm Gartner, Inc. in its ‘Magic Quadrant for Oracle ERP service providers, North America, 2010’ report, and has been a winner of several partner awards from Oracle. SYSTIME is the only Oracle partner globally to achieve all available Advanced Specializations (Financials, Distribution and Configurable Network Computing i.e. CNC) in JD Edwards2.
- Provides head-start into Brazil, one of the fastest growing emerging economies, where SYSTIME is a well established leader serving global JDE clients.

This partnership along with KPIT’s earlier acquisition of CPG solutions (www.cpgsolutions.com) in October 2010 further reaffirms KPIT’s commitment to serve Oracle customers and to build a strong front-end in key geographies.

What does this partnership mean to SYSTIME:
- Capability to offer a comprehensive range of solutions & services: SYSTIME will be able to extend benefits of KPIT’s consulting expertise in the Engineering services, Middleware Technologies and other ERP solutions’ areas, to its existing customers.
- Global Presence: With this agreement, SYSTIME’s customers will be able to leverage KPIT’s global presence and delivery centers in USA, Germany, China and India.

Expressing his views, Mr. Kishor Patil, MD & CEO, KPIT Cummins, said “SYSTIME is an excellent strategic partner, and we are confident that our combined and complementary strengths would help create a leadership position for us in the larger Oracle ecosystem. We see great synergy in vision, focus verticals and domain knowledge. SYSTIME has a committed team specialized in JD Edwards, an area where we see a large market opportunity within our focus industries of manufacturing and energy & utilities. We believe this addition of JDE expertise will further enhance our position as a strong contender for large Oracle deals. We welcome SYSTIME into the KPIT Cummins family and look forward to its role in achieving our target of reaching $500 million in revenues by end of FY13”.

Vishal Grover, President and CEO, SYSTIME, said: “We have found an excellent partner in KPIT Cummins and are very excited about the benefits our clients, employees and key partners can gain. KPIT’s strong Industry expertise, larger geographic presence and a comprehensive suite of Oracle based offerings complement our strong relationships in JD Edwards’ space, and we expect this to help us offer better value propositions to the JD Edwards community.” The transaction is subject to legal and other clearances.