Expanding reach

Calcutta, Nov. 13: Tata Consultancy Services (TCS), India’s No. 1 software firm, is looking at buyouts in Europe, Japan and China.

“We have a presence in all geographies, (but) in some areas we haven’t grown as fast as we would have liked to,” Vish Iyer, chief financial officer (global business operations) of TCS, said today on the sidelines of an industry event in Bangalore.

TCS has been witnessing slower growth in France, Germany, Japan and China.

“We are exploring opportunities. The moment any acquisition opportunity comes up in these regions, we will grab it,” he said.

By expanding in the new markets, TCS will be able to reduce its dependence on the US.

The company garners more than half of its revenue from the US.

Dow alliance

TCS today said it planned to form an alliance with Dow Chemical Company to provide critical services to the US firm, its subsidiaries and joint ventures.

“This strategic partnership will deliver world class capabilities at an estimated 30 per cent savings,” Dow executive vice-president (business services) Dave Kepler said.

“This innovative approach uses a variable staffing model, centralises activities and maximises efficiencies to meet evolving business needs,” Kepler said

According to the agreement, Dow and TCS will build a strategic services centre near Dow’s global headquarters in Midland, Michigan.

Plans are underway to begin construction of a new facility next year, with the first phase designed to accommodate 1,250 employees. The unit will support the local economy through the creation of new jobs. TCS will also expand its offerings beyond Dow in the future, creating a service valley in central Michigan.

TCS reported an operating margin of 26.02 per cent for the July-September quarter, helped by higher staff utilisation and shifting of employees to low-cost locations.

The alliance is an expansion of an existing relationship between Dow and TCS, combining Dow’s leading chemical industry knowledge and operational discipline with the service delivery expertise of TCS.