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January 23, 1998


Techna Group makes Japanese alliances

Email this story to a friend. The Techna Group has announced the setting up of two joint ventures with a Japanese company in the software segment, one in Tokyo and the other in Calcutta.

According to Dr Alo Ghosh, director, Techna Group, Techna International of the US has set up a joint venture with NCK of Japan (an independent software company having equity participation of Hitachi) to develop software for the Japanese market.

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Christened Nippon Techna Corporation Ltd, the outfit is based in Tokyo with NCK holding 60 per cent of the equity and Techna International 40 per cent.

The second joint venture between Techna Digital of India and NCK of Japan has been christened Nippon Techna Software Private Limited. This company has the Indian partner holding 60 per cent of the equity and the Japanese partner holding the rest.

The total equity investment in both the companies is around Rs 30 million.

Dr Ghosh has said that Hitachi's software arm holds 16 per cent of the equity stake in the $8 million turnover NCK. The latter has been engaged in developing specialised software for the Japanese market.

The idea behind the tie-up is to dedicate NTS' operations to the long and short-term needs of NTC, including supply of manpower, adapting to Japanese hardware and software, Japanese language training and extended training in Japanese work culture.

Claiming that the Japanese software market has "as much to offer if not more than the US market'', he said redeployment of trained software personnel into markets such as Japan has become necessary.

Appropriate steps are being taken to penetrate the two key barriers to penetrating the Japanese software market - the Japanese language and the country's "highly idiosyncratic'' work culture.

Takuo Takase, president of NCK, said that the company's main business is from Hitachi. "In Japan, the scope for software development is more than what the local supply can offer. Hence, we need to transfer capability to countries such as India and Korea.''

Takase said that the formation of the joint venture companies to take advantage of the growing scope was in line with Japanese corporate culture wherein a dedicated shareholding is considered a prerequisite to long-term business relationships. As such, senior Hitachi and NCK executives will participate in both the Nippon Technas as shareholders as well as directors on the company boards.

He said the main focus of the software segment in Japan was development of software for the banking and manufacturing sectors. The Y2K issue, too, had emerged as a core area for software development. To begin with, the two Technas taken together hope to have business volumes of around $3 million in the first year of operations itself.

- Compiled from the Indian media

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