ManagementTanla calls off city expansion plans
Tanla Solutions Limited, a city-based telecommunications software and services provider, has called off its plans to set up a new development centre in Hyderabad and a backup/ disaster recovery centre in Bangalore. The company had earmarked Rs 77.26 crore and Rs 12.78 crore respectively for its Hyderabad and Bangalore expansion.
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“The board of directors discussed that as the benefits accruing to the Software Technology Parks of India-registered IT and ITeS units expire on March 31, 2011, it would be strategically beneficial for the company to commence operations in a special economic zone,” Tanla said in a filing to the BSE on Wednesday.
Accordingly, the company had leased space at DLF’s Cyber City SEZ in Hyderabad and commenced operations recently. Tanla, in December 2006, raised funds aggregating Rs 108.39 crore through a follow-on public offer of 15.8 million equity shares of Rs 2 each, for setting up the proposed centres.
With regard to the Bangalore centre, the release said, “Under the Data Protection Act in Europe, companies are not allowed to process and store personal data of users in a country outside the European Union and, therefore, Tanla has set up backup/disaster recovery centres in the UK, Finland and Dubai. Hence, the work at Bangalore has been stopped.”
The company has initiated the process of withdrawing the Rs 60-crore paid to Aparna Constructions and Estates Private Limited towards advance for the construction of Bangalore and Hyderabad centres. It collected Rs 23 crore as on December 20 last. The balance is expected to be paid back soon by Aparna, it said.
Tanla would now deploy these funds for general corporate purposes, which include working capital requirements, expenses relating to R&D and expansion of facilities, both within India and abroad, acquisition of businesses and building up the brand and products.
Tanla’s scrip ended the trade at Rs 61.80 on the BSE on Wednesday, up 0.57 per cent, over the previous close of Rs 61.45.