Acquisition of Laser Soft


In October 2009, Polaris announced the acquisition of a small Indian core system vendor, Laser Soft Info Systems. This privately owned company was established by Suresh Kamath. It had a number of development centres in India and was based in the southern state of Tamilnad, where it had an R&D centre in its home city of Chennai. Its original system was developed in 1992 and was Cobol and DOS-based. Over time, this became a broad offering dubbed ProBanker. In September 2004, the system was relaunched under the name LaserPanacea Core Banking suite. It spanned core retail, retail loans (within a component called Loanflo), corporate loans, treasury, private banking, asset management, trade finance (Prophecy), branch banking (ProBanker CB) and kiosk banking (Laser Touch). In total, the supplier claimed around 25 products while also offering a range of services. There were two versions of ProBanker/LaserPanacea comprising one based on RM/Cobol and C, with an optional ODBC interface to databases, and one (multi-currency centralised database) using Visual Basic and Visual C++, with Oracle, SQL Server or DB2 database. There were apparently 20+ users across the product suite (five of which used the core), of which virtually all were in India. Exceptions were Oman’s BankMuscat, which signed for ProBanker in late 2002, and Bangladesh-based Janata Bank, which took the Windows and Cobol version for a four branch operation in the UAE. A bank in Kuwait took the system in 2009 apparently for liquidity management. Polaris’ acquisition of Laser Soft was an all cash deal worth


around $11 million, of which $7.4 million was to be paid in cash on closing. The rest would gradually be paid over the next two years, linked to performance. Laser Soft and its 600 or so employees would remain independent within Polaris, suggested K Srinivasan, Polaris’ head of alliances, and its solutions would continue to be marketed separately from the Intellect Suite. LaserPanacea would continue to be offered for fast


replacement scenarios, while Intellect, according to Srinivasan, was better suited to legacy modernisation projects, and for ‘large banks who are not interested in rip and replace’. Laser Soft’s existing presence in India, and its relationship with both private and public banks in the country, was also felt to present an opportunity for Polaris.


One notable deal for the Laser Soft offering at around this time was from Andhra Pradesh State Co-operative Bank (APCOB), which comprised 22 district co-operative banks. These banks had different states of IT automation but Polaris was recruited to carry out a single centralised installation in the state’s capital, Hyderabad. ‘The idea is to share a complete infrastructure,’ said Kamath. All the banks, which between them had close to 600 branches, would have the same delivery channels, the objective being to improve automation and share costs. Kamath felt Laser Soft’s acquisition by Polaris had been viewed in a positive light by APCOB: ‘We are now a much bigger provider, which has really helped us.’ The global reach for LaserPanacea (which now also seemed to be going under the Intellect brand) was much greater, and Kamath claimed that new customers had been picked up either side of the end of the year. He stated that there were currently implementations in the Seychelles and in Kosovo. He also regarded the APCOB project as a strategic one for the vendor, with the co-operative banks in other states, such as West Bengal and Rajasthan, interested in how the central installation model would work. There was later a fall-out with long-standing LaserPanacea


user, Corporation Bank in India. The bank went to market in 2012/3 looking for a new core system and excluded Polaris from the RFP process. The vendor took the bank to court, citing a ‘discriminatory’ RFP process in which Polaris did not meet the requirement. In response, the bank made some less than complimentary remarks about Polaris including, ‘the respondent encountered various problems like file corruptions and system slowness in the existing core banking solution which put the bank in avoidable embarrassment’ and ‘the petitioner has failed miserably in addressing the bank’s requirements’. The judge subsequently ruled that there was no case to answer for, saying that the claim was ‘devoid of merits’. Corporation Bank selected


Infosys’ Finacle, but the


project was abandoned before it reached the contract signing stage. The bank then went back to market in 2014, and again excluded Polaris from its shortlist. By the end of the year it had ended up with the same finalists as first time round: HP bidding with Finacle and Wipro bidding with TCS’s Bancs. The contract was cited to be worth $64 million.


Universal Banking Systems Market Report | www.ibsintelligence.com 233


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