Defiance Technologies offers virtual engineering services, ranging from basic design to high-end predictive analysis for auto makers.

"The idea is to have related services under one company. The demerger will happen after discussions on the modalities and valuation as Ashok Leyland is a listed company," a company official, who did not want to be named, said.

The company would offer its design services under "a single face and brand", which is Defiance, the official said.

Post-restructuring, Defiance Tech would undertake a major expansion drive, including entering technology-enabled manufacturing and enterprise solutions areas.

Defiance Technologies was formerly Ashley Design and Engineering Services, but was rebranded after Ashok Leyland acquired US-based company Defiance Testing and Engineering in 2007 for around $15 million.

V. Sumantran, a senior official of the Hinduja group that owns Ashok Leyland, said Defiance Tech has now grown as a "significant global player" in automotive testing and engineering services.

"We will now go beyond engineering to technology-enabled manufacturing and enterprise solutions and also serve customers in sectors like aerospace, defence and general manufacturing," Sumantran, executive vice-chairman of Hinduja Automotive Ltd, told reporters.

Apart from enlarging its service offering and the verticals it would service, Defiance Tech is also expanding its geographical presence to new regions like Europe, the Middle East and Asia Pacific Region, company chief executive Subu D. Subramanian said.

At present Defiance Tech is present in India and the US. Subramanian said the company would increase its headcount by 4,000 to 5,000 over the next three years.