Israel-based IT services provider Ness Technologies on Wednesday said it is looking to buy two companies in India in the outsourced product development and financial services areas by the end of next year, Indian business daily Business Standard reported.

We are less interested in acquiring big revenue and are now focused on acquiring competencies to further penetrate into specific vertical markets. We are looking at buying companies with revenue of between $20 million and $50 million. Whether we expect these deals to wrap up by the next calendar year could be much earlier or much longer than that as it is very difficult to predict buyout deals, Sachi Gerlitz, president and CEO of Ness, was quoted as saying in the report.

The Nasdaq-listed company acquired Apar Infotech, a US outsourced product development company with operations in Bangalore and Mumbai, for $78 million in 2003 to enter the Indian market. Ness bought Innova Solutions, a Hyderabad-based IT company focused on financial services, for $25 million in 2007.

The report said Ness had used debt to finance its acquisitions. Gerlitz was quoted as saying that the company is comfortable to fund its proposed buyouts with its net debt at $40 million and about $60 million in cash on its books currently.

Ness, which employs 7,800 people globally, reported revenue of $512 million for the year ended December 31, 2009, down from previous year's revenue of $608 million.

The company expects revenue to be between $575 million and $585 million for 2010 helped by the acquisition of Gilon Business Insight early this year.