TCS Signs Shareholder Promoters Agreement to Establish Software JV with Chinese Firms

Tata Consultancy Services Ltd (TCS) has announced that Tata Consultancy Services Asia Pacific Pte, a subsidiary of the Company, announced that it had signed a Shareholder Promoters Agreement and other relevant commercial documents with Beijing Zhongguancun Software Park Development Co., Uniware Co., and the Tianjin Huayuan Software Area construction and Development Co., to establish China’s first industrial scale software company.

The joint venture, Tata Consultancy Services (China) Co., will provide IT outsourcing services and solutions to the Chinese domestic market as well as the global market. Microsoft will participate in the joint venture as a strategic investor, as soon as the joint venture is established.

The Company will have the majority equity stake and management control of the joint venture company. Tata Consultancy Services (China) Co., will be located in Beijing’s Zhongguancun Software Park (z-Park), is expected to start operation in September this year and will provide IT services and solutions to China’s domestic market as well as major markets particularly Japan as well as the rest of Asia-Pacific region, US, and Europe. The key objective of this global initiative is to build the new venture as a role-model for the growing Chinese software industry.

The Shareholder Promoters Agreement and other relevant commercial documents were signed by representatives of the partners in Beijing today. Officers from National Development and Reform Commission of PRC, Beijing Municipal Development and Reform Commission, Tianjing Municipal Development and Reform Commission were present on the occasion to witness the signing ceremony.

The joint venture will leverage the complimentary strengths of the different partners in technology, software development management, talent acquisition and training, including the world-class processes and practices of the Company as well as its experience of handling large and industrial-scale technology projects. It will also leverage experience and resources of the Chinese partners, which run the national software development parks. This successful model of cooperation has been initiated and supported by NDRC, with the objective of supporting China’s local software industry through international cooperation.

"This venture is a significant business opportunity, which is China-centric from a resource perspective, has global appeal in terms of its customer offerings and is capable of creating a Chinese domestic business of increasing scale," said S Ramadorai, CEO and MD of the Company. "TCS will help develop best-in-class core competencies in software engineering, processes, scalable software development by using our unique and world-renowned learning and development model that will create new opportunities for IT professionals and the industry in China," Mr Ramadorai added.

Source : Equity Bulls

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