Japanese firm Hitachi today said it will acquire Prizm Payment Services as part of plans to grow revenues in India by nearly 3 times to about $2.95 billion by 2015-16 fiscal.
Hitachi, which did not disclose the financial details of the deal to buy the Indian company, said the transaction is expected to be concluded by February.
Hitachi said in a statement that it has “entered into share transfer agreements relating to all the issued equity shares of Prizm Payment Services with all the company’s shareholders, including Winvest Holdings (India) Pvt Ltd, Sequoia Capital, Axis Bank and other minority shareholders“.
“Hitachi and Prizm will target the end of February 2014 for a completion of the share transfer, in accordance with the terms of the agreements and subject to regulatory approvals required to consummate the transaction,” it said.
India, important
Tokyo-headquartered Hitachi sees India as an important region in its global strategy and is stepping up development of the Group’s Social Innovation Business in the country.
“Hitachi aims to grow revenues in India by nearly 3 times to 300 billion yen by the fiscal year ending March 31, 2016, compared with the year ended March 31, 2012,” it said.
Elaborating on the firm’s move to acquire the payment solutions firm (Prism), Hitachi said, in India, the IT market is expected to grow rapidly, with some forecasts calling for an IT investment growth rate exceeding 10 per cent for five straight years from 2013-17, driven by economic expansion.
Since it was set up in 2008, Prizm has grown to have over 10,000 ATMs deployed and under management and maintenance, and over 52,400 Point of Sale devices under management.
The network is managed by over 1,000 employees in 8 offices and 105 service locations covering 600 points of presence across India.
“By leveraging Prizm Payment Services’ robust customer base of major financial institutions, and know-how of payment systems, cash operations and management systems for financial institutions and other expertise, Hitachi will step up development of IT services business in India and globally,” Hitachi said.
Financial institutions in the country are working to roll out various services, including mobile device-based payment services, it added.
In accordance with this, the number of ATMs and POS systems, which have a low penetration rate at present, is increasing. ATMs in particular are estimated to nearly triple in number in 4 years from around 100,000 in 2012, Hitachi added.
Hitachi President Hiroaki Nakanishi said: “Hitachi is endeavouring to strengthen IT services businesses in the fast-growing Asian region in particular.”
The senior management team of Prizm Payment Services will remain intact and be integral to the success of Hitachi’s goals of this acquisition, Hitachi said.