Valdel Corporation, formed by merging the three business entities of the Bangalore-based M S Ramaiah group, is foraying into the retail segment in technical collaboration with Suiwah Corporation of Malaysia to set up one of the country's largest supermarkets in Bangalore.
The Rs 25-crore (Rs 250 million) Valdel also plans to enter the booming IT-enabled services market with its business process outsourcing venture later this year with an initial investment of Rs 10 crore (Rs 100 million) for catering to telecom, financial services and retail verticals.
In order to leverage the strengths of its engineering and construction company, formerly known as John Brown Technologies, AmSoft Information Services, a joint venture with the US-based (i)Structure of the Level 3 Communications, and its retail subsidiary, formerly Sun Mart, Valdel has restructured the entire set up and emerge as a multi-business corporation.
"The merger of the diverse entities will enable Valdel to synergistically cross leverage each company's entities strengths and increase the value delivered to all the stakeholders," said Valdel managing director M J Shantharam in Bangalore on Tuesday.
"It will also help us stay focused in expanding the business prospects through international tie-ups and joint ventures with new investments for achieving the projected revenue targets," he said.
Valdel Retail will invest Rs 25 crore (Rs 250 million) to set up a super mall in an area of 100,000 sq ft to house a large department store, a food court, and an entertainment centre in south Bangalore, which is emerging as a hub of IT firms and multinationals.
"We have tied up with Suiwah, which operates a string of retail chains in Malaysian cities, to provide technical assistance, training, and management practices for offering the state-of-the-art customer services," Shantharam said.
With the lifting of quantitative restrictions on import of any number of consumer goods, cosmetics and healthcare products, and food items, the Valdel mall plans to store large quantities of imported stuff for up-market consumers.
"We are targeting a Rs 100-crore (Rs 1 billion) revenue by 2005 from our retail venture, which includes substantial exports of Indian goods to South East Asia and China through our Malaysian partner," claimed MSR Group Chairman M R Jayaram.
The company also plans to introduce ATMs, a 24-hour chemist corner, bakery, photo shop, floral and beauty care after the first year of operations. It will initially employ about 500 people to operate the supermarket.
For its BPO venture, Valdel has roped in Ashwani Srivastava of Global CMS to head the operations and set up a 250-seater contact center. Its multimedia offerings will include transaction processes in financial and retail services and BPO services in telecom and other verticals.
As part of its restructuring exercise, AmSoft has appointed Richard Bradfield, who worked with the US-based TMI and 3M/Media Services earlier, for expanding its portfolio of offerings to IT infrastructure, education, and retail industry verticals from the existing software solutions and consulting services in banking, finance, and healthcare.
The SEI-CMM Level 4 IT firm is set to double its employees' strength to 150 in a year for executing the new projects. The Rs 7-crore (Rs 70 million) company is projecting a revenue target of Rs 20 crore (Rs 200 million) by 2005.
To provide high quality cost-effective engineering, procurement and construction services to customers worldwide in the hydrocarbon sector, power, and chemical industries, Valdel Engineers & Constructors has revamped its set-up by bringing in K Satyanarayan, former chairman of Engineers India Ltd, as president and CEO.
After the exit of John Brown Engineers & Contractors of the UK from the joint venture, Valdel E&C has tied up with S&B Engineers & Constructors of the US-based $1.2-billion S&B affiliated group, dealing with engineering procurement and construction.
The Ramaiah group holds 74 per cent of the Valdel E&C joint venture, while the Houston-based S&B Engineers holds the remaining 26 per cent of the total equity.
The Rs 18-crore (Rs 180-million) Valdel E&C has also entered into partnership with Paragon Engineering Services of Houston, Texas, to undertake onshore and offshore oil exploration projects.
The company is targeting a revenue of Rs 50 crore (Rs 500 million) by 2005 from turnkey projects. It plans to double its staff strength to 500 employees.
Incidentally, the multi-billion Ramaiah group also runs a string of engineering and medical institutions in Bangalore.