Shares of Patni Computer Systems Ltd, India’s sixth largest software and services exporter, fell 3.01% even as the company offered to buy back shares worth $60 million (Rs237 crore) at Rs325 share.
After the company made the offer, the shares fell on the Bombay Stock Exchange to Rs270.25 a share, in line with Sensex, the exchange’s benchmark index, which fell 3.38%.
Patni can potentially buy back some 7.3 million shares, or 5% of its equity.
“Buy-back of the 5% equity is too small to make a difference,” said an analyst with a foreign brokerage in Mumbai who did not wish to be quoted.
Patni, one of India’s oldest software firms, was set up in 1978 by three brothers, Gajendra Patni, Narendra Patni and Ashok Patni. They own close to 14% each in the company.
The company’s shares peaked at Rs572 on 29 May 2007 amid speculation that the 28% stake held by Ashok and Gajendra Patni was up for sale. Private equity firms such as the Carlyle group and Apax Partners had shown interest in buying the stake.
However, the talks failed over the issue of management control which is held by Narendra Patni.
The company’s stock price on Thursday was 52.7% lower than its all-time high.