Delisting price of Rs 520 higher than anticipated: Phaneesh Murthy
Prasad Koparkar, senior director at CRISIL Research, and Girish Pai, head of equities at Centrum Broking, discuss what can be expected from corporate earnings in the fourth quarter.
US-based iGate will offer Rs 520 per share to shareholders of Patni Computer Systems to get its Indian arm delisted from stock exchanges. The company has accepted the discovered price of Rs 520 determined through a reverse book building process.
Phaneesh Murthy, CEO, iGATE Patni told NDTV that the delisting price of Rs 520 is quite expensive, much higher than what was planned for.
iGate, along with private equity player Apax Partners, had acquired a majority stake in Patni for $1.2 billion and had paid Rs 503 per share in one of the largest IT deals in India. The delisting comes at a 3.4 per cent premium. iGate has organized $265 million funding for the buyback of shares.
“Better fourth quarter performance helped in convincing the bank to raise debt amount to $265 million and hence, we were able to get the debt at 3.6 per cent interest compared to 5 per cent. Our total debt stands at $ 950 million for now,” said Murthy.
Murthy further said that the company can generate enough revenues with current operating margins to reduce debt over the next few years. “The entire Patni delisting will now be complete in a few weeks,” he assured.