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Vanda subsidiary gets US$9m investment

Summary

Systems integrator Vanda Systems has announced Baring Asia Private Equity Fund and Intel are to invest a total of US$9 million in its subsidiary Comtech.

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HONG KONG--Systems integrator Vanda Systems has announced Baring Asia Private Equity Fund and Intel are to invest a total of US$9 million in its subsidiary Comtech.

Vanda is a locally listed systems integrator with a strong presence in the Mainland Chinese market.

Meanwhile, Comtech specializes in networking and intelligent cabling solutions. The company is also entering the market for broadband Internet access over cable TV networks in China.

Under the terms of the agreement, Intel will invest US$4 million, while Baring will invest US$5 million. In return, Comtech will issue certain convertible preference shares.

After the share issue, Intel will hold 10.36 percent of Comtech, while the Baring Fund will hold 12.82 percent.

Edmund Ma, Vanda's group managing director said the money would be used as working capital. He also said at present, they had no specific plans for the future, but would look for ways to continue growing, including acquisitions.

Intel has a well established policy of investing in companies that it believes will help increase the market for its products. This includes its investment earlier this year in Richard Li's Pacific Century CyberWorks.

Eric Levin, the company's senior treasurer for strategic investments in Asia Pacific said: "We believe systems integration and intelligent cabling are areas that will expand the market, in Hong Kong and China."

He added: "Companies like Comtech are building the plumbing, that's where the opportunities are as we roll out the Internet across China."

Meanwhile, the Baring Fund is a US$300 million fund, which has already invested about US$100 million across Asia in the last 12 months.

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