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QuEST, a US-based company with virtually all its
operations in India and which helps cut the costs of
developing new products for manufacturers based in Europe
and North America, is planning a London listing in a move
that would value the company at about $90m (£46m), writes
Peter Marsh in Bangalore.
The expected listing is likely to be on the Aim branch of
the exchange and take place round September.
While its headquarters are in Connecticut, QuEST is run by
two Indian engineers. It has 850 of its 1,000 staff in
Bangalore, India.
The employees work on developing new products using
computer-based analytical tools on behalf of companies
round the world including General Electric and Danaher of
the US and Rolls-Royce and Smiths Group of the UK.
QuEST is expected to have a net income of about $3m in the
year to the end of March 2007, on sales of $40m.
The London arm of Nomura, the Japanese bank, has been
lined up to advise on the listing.
Aravind Melligeri, the 37-year-old president and joint
founder of QuEST, said the company had decided on listing
on Aim because of the exchange's record in attracting
"growth companies" and because the alternative of listing
in New York seemed "too expensive" on account of
regulatory requirements.
Mr Melligeri owns 30 per cent of QuEST.
Ajit Prabhu, QuEST's chief executive, aged 35, and with
whom Mr Melligeri started the business in the US in 1997,
owns the same amount.
A further 24 per cent is owned by Carlyle, the US venture
capital group.
The rest of the stake - 16 per cent - is held by senior
managers.
Under the planned listing, Carlyle would probably sell all
or most of its stake, leavingMr Melligeri and Mr Prabhu
the majority owners with a shareholding of slightly more
than 50 per cent, with the rest held by public investors.
Mr Melligeri said QuEST had a "great opportunity" to
expand rapidly, based partly on the expertise of its staff
in computer-aided product development. There is also a
plan to expand in the next few years into manufacturing
products in India on behalf of customers, particularly in
aerospace, and take advantage of India's low labour costs.
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