Indian sells Net company for $450m
Bala Murali Krishna
NEW YORK 19 APRIL
FOR somebody who once said he started a company after only reading books and spending time in Silicon Valley, Indian-American Hemant Kanakia has done exceedingly well.He has just sold his firm, Torrent Networking Technologies, in Silver Spring, Maryland, to Swedish multinational Ericsson for $450m in cash.
A researcher for many years, Mr Kanakia quit AT&T three years ago to found Torrent which designs advanced routers that power the Internet. Mr Kanakia said Ericsson's worldwide presence would help Torrent make a greater impact on the market.
''The offer was attractive to us,” he said. ''We looked at the company's large global resources, its sales and distribution networks. ...that is what swayed our minds finally.”
Ericsson said the acquisition was a ''strategic move into next generation of IP (Internet protocol) carrier networking”.
''The acquisition will have a substantial impact on our ability to provide a complete data networking solution,” said Sven-Christer Nilsson, president and chief executive officer of Ericsson.
The acquisition has become effective with immediate effect: Torrent has become a part of Ericsson Datacom. Simultaneously, Ericsson has acquired TouchWave, Inc, a provider of Internet protocol telephony products, for $46 m.
Mr Kanakia said his own role will not change much since he had already handed over the executive reins to Jean-Luc Abazio, also the Torrent president, and is now looking at new IP strategies. ''I had moved into a strategic role a couple of months ago,” he said, adding that he expected Ericsson to bring beneficial change at Torrent.
Mr Kanakia is an engineering graduate from Indian Institute of Technology, Mumbai, and a PhD from Stanford University.
As a researcher with AT&T Bell Laboratories, Mr Kanakia had pioneered the development of revolutionary new switching architecture. In fact, Mr Kanakia holds several patents on switching architecture and transport of video streams over data networks.
The sale still evoked mixed emotions, said Mr Kanakia. ''I am delighted at the opportunity it gives Torrent,” he said. ''But, I am also sad that it is not as small as it was. It is like (when) kids grow up and go to college.” Torrent was started with early-stage financing from a Silicon Valley businessman, Raj Mash-ruwala. It received a number of offers from venture capitalists. — IANS
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