According to Software Solution chairman and chief executive officer K Suresh, the talks are in an advanced stage and a formal alliance is expected to be concluded with Microsoft soon.

The new 100,000 square feet software-development centre, to be established in Chennai, will be one of the largest of its kind in the country and will exclusively focus on developing value-added components for software programmes being used by a wide range of customers.

Microsoft, as a strategic partner, will add its technological expertise in creating these value-added products, which will provide the cutting edge of technology to users.

Suresh said that the company's new software-development centre would work in advanced component products, which would find use in highlyspecialised areas like Internet banking, which is yet to take off in India, and in select application areas like electronics funds transfer through SWIFT, credit cards, airline travels, etc.

According to him, the advanced components the company will develop can also help overcome the Y2K problem, which is still to be ironed out by a host of users in different segments.

The strategic alliance, besides giving support and expertise in cutting-edge technology, will also help Software Solution get confirmed orders from Microsoft and an entry into doing value-added jobs for a wide range of Microsoft clients, Suresh added.

Software Solution has also roped in K Srinivas of Tiffanys from Dubai to head the software centre. Suresh said that the company had searched far and wide for the right person to head the centre, including from top multinational companies, before signing up Srinivas. The centre is expected to be operational from July. "We did not want a purely technical man because such people run out ofideas soon. We were looking for a man with hands-on management experience who could take care of not just marketing but all related areas like production, finance, etc," Suresh said.

Srinivas was picked up after a series of six meetings with the Software Solution top brass. He had to present a business strategy plan to them on making the new centre profitable. Although reluctant to talk about details about the plan, Suresh said the company was hoping to clock a turnover of Rs 20-25 crore from the new centre in the first year of its operation.