Bangalore, Jan 10 (Agencies): US-based iGate today said it has acquired nearly 63 per cent stake in country''s sixth largest IT firm Patni Computer Systems for USD 1. 22 billion. ‘Deal good for Patni, better for iGate’
iGate will buy 45.6 per cent of the shares of the three founders of Patni -- Narendra Patni, Gajendra Patni and Ashok Patni-- along with the 17.4 per cent stake of private equity firm General Atlantic, iGate CEO Phaneesh Murthy told reporters here.
The transaction is valued at approximately USD 1.22 billion, including the mandatory 20 per cent open offer to be made to the public shareholders of Patni, he added.
The deal is expected to be completed in the first half of 2011, after acquiring all the regulatory approvals.
Shares of Patni Computer were trading at about Rs 466.80, up 1.46 per cent on the Bombay Stock Exchange.
Industry watchers have given a thumbs up to the deal, saying it will give the merged entity scope to compete with larger companies for bigger projects.
"The deal is good for Patni, which for the last two years has been undergoing a period of uncertainty, giving it a clear roadmap for growth and competing with the bigger players,"
Gartner Senior Research Analyst Arup Roy told news agencies.
But it is a better deal for iGate, since the combined entity will be worth almost a billion dollars, which can help swing large deals in its favour, he added.
"The combined size and scale will help the new entity compete for larger deals, especially with the top three players," Roy said.
PriceWaterhouseCoopers Associate Director Abhijeet Ranade said the deal will help the companies optimise cost and performance of both the companies.
"I have always maintained that consolidation is inevitable in the industry. The deal will help both companies optimise cost and efficiency, as well as explore new
verticals," Ranade said.
Mastek Group CFO and Finance Director Farid Kazani said the deal is a win-win situation for both companies.
Bangalore, Jan 10 (Agencies): US-based iGate today said it has acquired nearly 63 per cent stake in country''s sixth largest IT firm Patni Computer Systems for USD 1. 22 billion.
‘Deal good for Patni, better for iGate’