Funds affiliated with Baring Private Equity Asia (BPEA) will buy about 30 per cent stake in mid-sized IT services firm NIIT Technologies from NIIT Ltd and other promoter entities for about Rs 2,627 crore, as per a regulatory filing.
The deal will also trigger an open offer under which BPEA will make an offer to the public shareholders of NIIT Technologies for purchasing up to 26 per cent additional shareholding - taking the total deal value to up to Rs 4,890 crore.
In a late night filing to BSE on Saturday, NIIT Technologies said "funds affiliated with Baring Private Equity Asia (BPEA) have signed definitive agreements to buy about 18.85 million shares" of the company (approximately 30 per cent shareholding) from NIIT Limited and other promoter entities at a price of Rs 1,394 per share.
"The aggregate consideration for purchase of shares from promoter entities is estimated to be approximately Rs 2,627 crore," it added.
This includes about 14.4 million shares of NIIT Ltd, and about 4.3 million shares held by members of families of NIIT founders Rajendra Pawar and Vijay Thadani.
NIIT Ltd holds about 23 per cent stake, while Pawar and Singh with their families hold around 7 per cent shares in NIIT Technologies.
In accordance with the Securities and Exchange Board of India (SEBI) regulations, BPEA will make an open offer to the public shareholders of NIIT Technologies for purchase of up to 26 per cent additional shareholding at a price of Rs 1,394 per share - taking the total shareholding to approximately 56 per cent.
"The aggregate consideration for purchase of shares from promoter entities and the open offer is estimated to be up to approximately Rs 4,890 crore," it said.
In a separate filing, NIIT Technologies said the open offer for up to 1.62 crore fully paid-up equity shares (representing 26 per cent stake) will be made by Hulst BV along with The Baring Asia Private Equity Fund VII, LP, The Baring Asia Private Equity Fund VII, LP1 and The Baring Asia Private Equity Fund VII, SCSp.
This transaction is conditional upon customary conditions, including receipt of required regulatory approvals, including anti-trust and competition clearances from the Competition Commission of India.
"NIIT Technologies Ltd which became an independently listed company after demerger from NIIT Ltd in 2004, has grown into one of the most innovative and trusted IT services company in India.
"The long-standing relationships with marquee customers, many spanning over two decades, are a consequence of a sharp focus on identified verticals including, travel, banking and insurance and distinctive capabilities developed," NIIT Technologies Chairman Rajendra Pawar said.
He added that the involvement of BPEA will provide further impetus to the management team led by CEO Sudhir Singh to take the company to the next level of growth.
Vijay Thadani, vice chairman and managing director at NIIT Ltd, said BPEA's association will support the existing management team in capturing the opportunities in an increasingly digital world.
Credit Suisse acted as the exclusive financial advisor to NIIT Ltd and other promoter entities. Shardul Amarchand Mangaldas & Co acted as the legal advisor to NIIT Ltd. J Sagar Associates and Ropes & Gray acted as legal advisors to BPEA.