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BFL Software plans $20 million ECB

A senior executive of the company has said that a formal decision is expected soon. BFL Software is, however, yet to award the mandate to financial agencies as the Reserve Bank of India approval for the ECB plan is pending.

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The company is currently holding preliminary discussions with some Bangalore based banks, the executive said.

BFL will opt for the ECB route, as it is more viable than the domestic route and will bail out the STP project, which has been put on hold for quite some time. The company has already acquired land near Bangalore for this purpose.

At its fourth annual general meeting of August 21, 1996, the shareholders of BFL had approved a resolution to raise up to Rs 1.5 billion by means of term loans or foreign currency loans for future expansion plans.

Once the STP goes on stream, the company will relocate all units in and around Bangalore to the new location. "We are planning to increase the staff strength from the existing 600 to around 1,000 by 2002," sources said.

The annual general meeting of the company, slated to be held in November, will now be conducted in February, the executive said. The company was to hold its AGM in September but postponed it to November to achieve its divestment plans.

The divestment plan continues to be in a limbo as BFL is yet to identify a suitable partner. The company's initial plan to offload a stake to Alliance DLJ Private Equity Fund of the US fell through as the foreign firm insisted on a controlling stake.

BFL, on its part, is willing to offer only 30 per cent. "We expect to finalise a partner sometime during the next fiscal," said a senior officer said.

BFL is expected to surpass its turnover projections of Rs 550 million for this fiscal, thanks to the Asian currency turmoil.

The company recently bagged orders worth $350,000 for its Y2K project from an American bank based in Chicago. This was despite stiff competition, company sources claimed.

It is also planning to develop a product on networking technology jointly with an US-based firm.

- Compiled from the Indian media

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