Home Economy iGate acquires majority stake in Patni Computers

iGate acquires majority stake in Patni Computers


Mumbai/Bangalore : US software company iGate along with private equity firm Apax Partners has agreed to acquire a majority stake in Indian software services major Patni Computer Systems Monday for about $920 million.

The Indian software company in a regulatory filing said that iGate would buy out the promoter stake of Narendra Patni, Gajendra Patni and Ashok Patni approximating 43.6 percent for about Rs.503.5 per share.

The Phaneesh-Murthy led iGate will also buy a 16.6 percent stake belonging to private equity fund, General Atlantic.

Talking to reporters in Bangalore, Murthy said the transaction value could be as high as $1.22 billion, if the mandatory open offer of 20 percent that iGate would have to make to remaining shareholders of Patni is fully subscribed.

The deal is one of the biggest acquisition in the Indian software industry and is expected to be completed in the first half of 2011, after acquiring all the regulatory approvals.

On the Bombay Stock Exchange, the Patni scrip rose 3.84 percent to touch an intra-day high of Rs.477.80 in a market which was reeling under selling pressure. It was ruling at Rs.466.15 in late trading.