Infosys Chairman N.R. Narayanamurthy said the company had been on the lookout for an acquisition since the listing of its stock on the US-based NASDAQ stock exchange in 1999, but had not found any suitable partner until now.

"Since then we have looked at 135 or so candidates. I am very very happy, to say that after a global search and after spending a lot of time, we have been able to find one such firm," he told a news conference in the southern city of Bangalore.

Nandan M. Nilekani, chief executive officer of Infosys, said part of the payment for the acquisition would be made upfront and the rest through the Australian firm's future earnings.

Infosys said Expert Information Services was one of Australia's leading IT service providers, specialising in designing, building and integrating business solutions and products.

It has a workforce of 330 people and has about 40 clients, mostly in the telecommunications sector.

The company notched a net profit of 5.2 million dollars in the year ended June on revenues of 34.6 million dollars.

Infosys has more than 19,000 employees in more than 30 offices worldwide and its total revenues for the fiscal year to March 2004 were forecast at between 46.2 billion rupees (one billion dollars) and 46.6 billion rupees.

However, a stock market analyst in India's financial capital Bombay said that they were not dazzled with the acquisition.

"This acquisition is beneficial, but not significant for Infosys," said an information technology sector analyst working for stock brokerage firm Motilal Oswal.

He said the acquisition by Infosys was a move aimed at circumventing the outcry abroad over outsourcing services from India as it cut jobs overseas.

It will enable Infosys to have a bigger foothold in the country as Australian firms would probably be more comfortable dealing with Expert, he added.

Infosys stock closed down 1.6 rupees at 5,120.5 on the Bombay Stock Exchange.

SPACE.WIRE