Xchanging to acquire Cambridge for 83 mn pounds
UK BPO wants to acquire 75% stake in Bangalore-based IT/ITES firm Cambridge Solutions in a cash-cum-share deal.
By ET Bureau |
BANGALORE: Xchanging Plc, the UK headquartered BPO major, has announced its intention to acquire 75% stake in the Bangalore-based IT/ITES firm Cambridge Solutions in a cash-cum-share deal valued at 83 million pounds (around Rs 689 crore).
This would also include the open offer to be made by FTSE-listed Xchanging to acquire up to 20% of the fully diluted voting share capital of Cambridge Solutions. Currently the UK company would be acquiring the stake of the majority shareholders in Cambridge Solutions - Scandent Group. ET had first reported about this deal in its edition dated July 1, 2008.
According to a release, ���The consideration for the acquisition will be approximately ��83 million, comprising Rs 371.2 crore in cash (equivalent to approximately ��45 million (Rs 373.5 crore at current rates) and the issue of 15,249,998 New Xchanging Shares. The New Xchanging shares amount to 7% of the company���s current issued ordinary share capital. Two of the original Scandent promoters, serial entrepreneur Ramesh Vangal and the Geneva-based Chandaria family, will be holding equity stakes in Xchanging.
Commenting on the acquisition, Ramesh Vangal of Katara Group and one of the key shareholders of Cambridge said, ���I am delighted with Xchanging���s entry. The combination of Xchanging���s Management depth with Cambridge strengths in US, Australia and India creates a premier BPO machine. From an Xchanging perspective its a great deal since I believe Cambridge share price understates its intrinsic strengths.���
However, the current valuation of Cambridge Solutions seems to be on the lower side as it has been valued at around Rs 918 crore, while it reported a consolidated revenue of Rs 1236.32 crore for FY08 with a net loss of Rs 8.79 crore.
Xchanging reported revenue of ��468.2 million for 2007. Incidentally, last year, Ramesh Vangal had teamed up with private equity major Carlyle for a possible acquisition of majority interest in Cambridge at a higher valuation.
However, the deal fell through with some of promoters reportedly not backing the transaction.
This would also include the open offer to be made by FTSE-listed Xchanging to acquire up to 20% of the fully diluted voting share capital of Cambridge Solutions. Currently the UK company would be acquiring the stake of the majority shareholders in Cambridge Solutions - Scandent Group. ET had first reported about this deal in its edition dated July 1, 2008.
According to a release, ���The consideration for the acquisition will be approximately ��83 million, comprising Rs 371.2 crore in cash (equivalent to approximately ��45 million (Rs 373.5 crore at current rates) and the issue of 15,249,998 New Xchanging Shares. The New Xchanging shares amount to 7% of the company���s current issued ordinary share capital. Two of the original Scandent promoters, serial entrepreneur Ramesh Vangal and the Geneva-based Chandaria family, will be holding equity stakes in Xchanging.
Commenting on the acquisition, Ramesh Vangal of Katara Group and one of the key shareholders of Cambridge said, ���I am delighted with Xchanging���s entry. The combination of Xchanging���s Management depth with Cambridge strengths in US, Australia and India creates a premier BPO machine. From an Xchanging perspective its a great deal since I believe Cambridge share price understates its intrinsic strengths.���
However, the current valuation of Cambridge Solutions seems to be on the lower side as it has been valued at around Rs 918 crore, while it reported a consolidated revenue of Rs 1236.32 crore for FY08 with a net loss of Rs 8.79 crore.
Xchanging reported revenue of ��468.2 million for 2007. Incidentally, last year, Ramesh Vangal had teamed up with private equity major Carlyle for a possible acquisition of majority interest in Cambridge at a higher valuation.
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However, the deal fell through with some of promoters reportedly not backing the transaction.
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