The Polaris - Orbitech Merger

The merger provided OrbiTech with a better platform to deliver its products in the market; it gave OrbiTech access to 96 new clients and operational geographies, access to a strong sales and distribution network, and exposure to areas other than banking. On the other hand, Polaris got access to 57 IPRs of OrbiTech corresponding to 10 product lines, with a couple of new products in each product line. Each product line had an estimated potential of building a $20 mn business over a five-year period. Thus, a $200 mn increase in revenues was expected from this source. The merger strengthened Polaris' position in the BFSI software segment, giving it higher profit margins and reduced sales cycle time...

One significant advantage of the merger for Polaris was the increase in size. The company emerged one of the fastest growing companies in the Indian software industry with revenues from its top-line products increasing from Rs 150 mn in 1996 to over Rs 6 bn in 2003.

After the merger, the company also focused on increasing its presence in the BFSI products market. It had split the BFSI segment into six spaces - wholesale banking, retail banking, investment banking, brokerage, securities and insurance and focused on each of these segments to increase revenues.

The company also hoped to increase profit margins by reducing costs...