Citi to pay $112 m to de-list e-Serve

By siliconindia staff writer   |   Monday, 23 August 2004, 07:00 Hrs
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MUMBAI: Citigroup Inc. will pay Rs 975 per share to take a large majority stake and de-list the Indian outsourcing firm e-Serve International Ltd. in a deal worth $112 million.

U.S.-based Citigroup, the world's largest financial services company, had set a floor price of 735 rupees per share to de-list Bombay-based e-Serve, but it received most of the bids at 975 rupees at a reverse book-built process which ended last week.

In a statement to stock exchanges, Citigroup said it had received bids for 5.3 million out of the 6.89 million outstanding shares at or below the exit price.

After the acquisition of those shares, Citigroup's stake will go up to 87 percent.

"Accordingly, the acquirer is entitled to accept the exit price and de-list the company from all the stock exchanges," the statement said.

e-Serve shares rallied as much 4.1 percent to 969 rupees on Monday at the Bombay exchange, while the main Bombay share index was down 0.75 percent.

The shares have jumped 54 percent since Citigroup announced its buyout plans in mid-April, while the Bombay index has shed 13 percent during the same period.

Analysts said e-Serve was among the top five back-office outsourcing companies in India based on revenue. It is expected to report a rise in net sales of roughly 25 percent to about 3.2 billion rupees for the year ended March from a year earlier.

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