TCS, Mitsubishi to invest USD 5 m in joint venture

India's biggest software services exporter Tata Consultancy Services (TCS) and Japan's Mitsubishi Corporation on Wednesday announced setting up of a joint venture at an investment of USD 5 million for offering full service suite of IT, BPO and infrastructure services. 

"The JV will be set up with an initial investment of USD 5 million, which will be raised in a phased manner. In this joint venture, TCS Japan has taken 60 per cent stake, while the remaining 40 per cent will be held by Mitsubishi Corporation," TCS CEO and Managing Director N Chandrasekaran said during a conference call here. 

The joint venture company -- Nippon TCS Solution Center Ltd -- will offer full service suite of IT, BPO and infrastructure services to Japanese corporations. The new joint venture will also establish a nearshore delivery center in Japan, TCS said in a statement. 


The joint venture comes against the backdrop of a strong yen, the globalisation of supply chains and a growing trend toward overseas mergers and acquisitions, all of which act as a catalyst for the increasing globalisation of Japanese companies. 

This has brought heightened interest in the role of "global IT services" to link domestic and overseas operations, the company said. 

The nearshore delivery center will leverage Mitsubishi's significant domestic market expertise and the global expertise of processes and best practices of the TCS Global Network Delivery Model (GNDM), to meet the various needs of Japanese companies through enhanced solutions and service offerings, the release said. 

"Japan is a very important market for TCS... The new joint venture will provide strong local market knowhow, deep domain knowledge as well as bring in global technology best practices to help Japanese corporations effectively respond to their global IT needs," Chandrasekaran said. 

Chandrasekaran and Mitsubishi Corporation Senior Executive Vice President Hideyuki Nabeshima have been appointed as Non Executive Directors of the new company. 

Mitsubishi Corporation and TCS have already started collaborating in a wide range of areas that include establishing an IT support system that utilises TCS's know-how and its GNDM for Mitsubishi Corporation's overseas bases as well as implementing new employee training programs for Mitsubishi Corporation's Business Services Division and for IT Frontier Co. Ltd, at its training center in Trivandrum, it said.