Mahindra Satyam recovery gathers pace with European expansion

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Mahindra Satyam recovery gathers pace with European expansion

Karl Flinders

Mahindra Satyam is moving into the growth phase of its recovery from near collapse as it invests in another delivery centre in Europe.

The Indian IT service provider has opened a centre in Eindhoven, Holland, which will initially employ 45 people and support customers in Holland.

The new centre takes its total European delivery operations to six - three in the UK, two in Germany, where it also plans to open another next month, and now one in Holland.

The centres act as an interface between the client in the same locality and the back-end work in India. "They need to be in the local area for communication and comfort," said Vineet Nayyer, chairman at Mahindra Satyam.

This is part of the company's European growth strategy. It now has 1,000 employees in Europe, out of a total of about 30,000 across the world.

Earlier this month, Mahindra Satyam returned to profit after the company nearly collapsed in 2009 following a $1bn internal fraud carried out by former chairman B Ramalinga Raju. Satyam was acquired by Tech Mahindra later that year and has been recovering ever since. After its return to profit, the company said it had stabilised and will now focus on growth.

In its latest three-month period the company reported sales of $320m, which represented a 5.2% increase on the previous quarter and 19.3% more than the same period a year ago, and $50.2m profit.

Bindi Bhullar, director at HCL Technologies, said a local presence is vital if Indian companies are to hit their growth plans.

He said Europe represents about 30% of HCL's business and growth is coming from regions such as France and Benelux, the Nordics, and German-speaking regions. "Some customers want delivery centres in their back yard," Bhullar said.


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