Baring Private Equity Asia (BPEA) has agreed to buy a 30% stake in software services company NIIT Technologies Ltd for about ₹2,627 crore ($381 million).
Funds affiliated with BPEA have signed definitive agreements to purchase the stake totalling 18.85 million shares of NIIT Technologies from NIIT Ltd and other promoter entities.
Baring will acquire the shares at ₹1,394 apiece, NIIT Technologies said in a regulatory filing on Sunday.
The offer price is a 3.3% premium to the closing price of NIIT Technologies on Friday.
NIIT Technologies’ promoters, which include NIIT and the families of Rajendra Pawar and Vijay Thadani, hold a total of 30.04% stake in the company. NIIT directly has a 23.1% stake.
In accordance with Sebi regulations, Baring also made an open offer to the public shareholders of NIIT Technologies for a 26% additional stake at the same price of ₹1,394 per share. If the open offer is fully accepted, Baring will pay a total of ₹4,890 crore ($709 million) to acquire approximately 56% stake in NIIT Technologies, according to the statement.
Mint first reported on 18 January that Baring was in talks to buy a 30% stake in NIIT Technologies. “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," said Rajendra Pawar, chairman, NIIT Technologies.
The involvement of Baring Private Equity Asia will provide further impetus to the management team led by CEO, Sudhir Singh to take the company to the next level of growth, he added.
The deal is subject to regulatory approvals including anti-trust and competition clearances from the Competition Commission of India. “Baring Private Equity Asia’s association will support the existing management team in capturing the opportunities in an increasingly digital world. This transaction will further support our growth from being No.1 IT training company since inception in India to a global leader in talent development," said Vijay Thadani, vice-chairman and managing director, NIIT.
NIIT Technologies is the second Indian IT services company where Baring has bought a controlling stake. In 2014, it had acquired a majority stake in Hexaware Technologies Ltd.
“BPEA is pleased to be investing in NIIT Technologies. We look forward to partnering with the company’s management team to continue to build the business over the coming years," said Jimmy Mahtani, managing director at BPEA.
In addition, NIIT Technologies on Sunday said it is acquiring WHISHWORKS IT Consulting. NIIT Technologies will initially acquire a 53% stake in WHISHWORKS IT Consulting, which specializes in MuleSoft and Big Data technologies, with the remainder to be acquired over two years through pay-outs linked to financial performance.