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News >> Technology >>
EDS makes open offer for MphasiS
By agencies
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Tuesday, 04 April 2006, 19:30 IST
BANGALORE: In a smart move aimed at acquiring controlling stake in the Bangalore-based IT services and BPO firm MphasiS BFL Ltd, the Plano, Texas-based EDS has announced a conditional open offer.
As part of this offer, EDS proposes to acquire approximately 52 percent stake in MphasiS at an offer price of $4.64 per share in cash. The price of $4.58 represents an approximate 30 percent premium to the 26-week average price of MphasiS.
However, it was lower than the current market price of $4.90. The offer will be contingent upon EDS acquiring 83 million shares, representing approximately 52 percent of the current shares outstanding.
If at least 83 million shares are not tendered in the offer, EDS will not accept any shares tendered, the release said. At current exchange rates, the total purchase price for the 83 million shares is approximately $380 million. EDS expects this transaction to be completed by early third quarter i.e., July-September quarter.
Commenting on this, EDS Chairman and CEO, Mike Jordan said, This offer is complementary to our overall strategy to enhance EDS presence and capabilities in India.
Among the private corporate bodies, Barings India Investments Ltd owns 34.9 percent in MphasiS BFL, while MphasiS Holdings owns 4.62 percent as of December 31, 2005. MphasiS Chairman Jaithirth Rao owns 3.9 percent stake in personal capacity.
Some of the key FIIs which own stake in MphasiS include HSBC Global, Merrill Lynch Capital, Morgan Stanley, CLSA, FID Funds, Aberdeen Asset Management, among others. Among mutual funds, Fidelity and Templeton have holding in the company as of December 31, 2005.
MphasiS currently has more than 12,000 employees, including about 11,000 in India.