BEIJING, April 12, 2011 /PRNewswire-Asia/ -- VanceInfo Technologies Inc. (NYSE: VIT) ("VanceInfo" or the "Company"), an IT service provider and one of the leading offshore software development companies in China, today announced that it has acquired 100% equity interest in the main operating subsidiaries of LW International Holdings Limited ("Lifewood"), a China-based company providing business process outsourcing ("BPO") services. Under the terms of the acquisition agreement, VanceInfo will pay an initial consideration of $5.6 million in cash and stock, with contingent consideration to be paid based on Lifewood's financial performance over the next three years.
Established in 2004, Lifewood provides primarily data processing services to clients in the United States, Europe and Asia Pacific. Its key industry verticals include publishing, healthcare and financial services. The acquisition marks VanceInfo's strategic expansion into the BPO business, an early stage growth sector with increasing synergies to the IT outsourcing sector.
"Lifewood is a highly process oriented BPO service provider with a well-developed system platform and customer centric service culture," commented Chris Chen, Chairman and Chief Executive Officer of VanceInfo. "It invested heavily over the past few years and has built a solid foundation for us to move aggressively into this high-growth business that is complementary to VanceInfo's service offerings. We believe this strategic alliance will create synergies for both and allow VanceInfo to serve a broader range of international customers with combined offerings."
"We are very excited to join the VanceInfo family," said Ronald Cheung, Chief Executive Officer of Lifewood. "Leveraging VanceInfo's platform and Lifewood's BPO capabilities, we hope to quickly bring this young business to the next level and become a market leader in China-based BPO services in the future."
Lifewood generated approximately $4.5 million in net revenues in 2010. The transaction is expected to be slightly accretive to VanceInfo's 2011 earnings.
VanceInfo Technologies Inc. is an IT service provider and one of the leading offshore software development companies in China. VanceInfo was the first China software development outsourcer listed on the New York Stock Exchange.
The Company ranked number one among Chinese offshore software development service providers for the North American and European markets as measured by 2009 revenues, according to International Data Corporation.
VanceInfo's comprehensive range of IT services includes research & development services, enterprise solutions, application development & maintenance, quality assurance & testing, globalization & localization and other solutions and services. VanceInfo provides these services primarily to corporations headquartered in the United States, Europe, Japan and Greater China, targeting high-growth industries such as technology, telecommunications, financial services, travel services, manufacturing, retail and distribution.
This news release includes statements that may constitute forward-looking statements made pursuant to the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as will, should, expects, anticipates, future, intends, plans, believes, estimates, and similar statements. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Potential risks and uncertainties include, but are not limited to, the company's dependence on a limited number of clients for a significant portion of its revenues, the economic slowdown in its principal geographic markets, the quality and portfolio of its services lines and industry expertise, and the availability of a large talent pool in China and supply of qualified professionals, as well as the PRC government's investment in infrastructure construction and adoption of various incentives in the IT service industry. Further information regarding these and other risks is included in VanceInfo's filings with the U.S. Securities and Exchange Commission. All information provided in this news release and in the attachments is as of April 11, 2011, and VanceInfo does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.
SOURCE VanceInfo Technologies Inc.