iGate, Patni to benefit from deal: Analysts
Analysts said it is a better deal for iGate, since the combined entity will be worth almost a billion dollars, which can help swing large deals in its favour.
By PTI |
BANGALORE: Industry watchers have given a thumbs up to the $921 million Patni-iGate deal, saying it will give the merged entity scope to compete with larger companies for bigger projects.
"The deal is good for Patni, which for the last two years has been undergoing a period of uncertainty, giving it a clear roadmap for growth and competing with the bigger players," Gartner Senior Research Analyst Arup Roy told PTI.
But it is a better deal for iGate, since the combined entity will be worth almost a billion dollars, which can help swing large deals in its favour, he added.
A consortium of US-based iGate and Apax Partners today announced a deal to buy a nearly 63 per cent stake in mid-sized IT firm Patni Computer for about $921 million.
As per market regulator Sebi's guidelines, the iGate-led consortium now has to make an open offer for an additional 20 per cent stake in the firm, which will take the total value of the transaction to $1.22 billion (more than Rs 5,400 crore) if the share price of Rs 503 apiece is maintained.
"The combined size and scale will help the new entity compete for larger deals, especially with the top three players," Roy said.
PriceWaterhouseCoopers Associate Director Abhijeet Ranade said the deal will help the companies optimise cost and performance of both the companies.
"I have always maintained that consolidation is inevitable in the industry. The deal will help both companies optimise cost and efficiency, as well as explore new verticals," Ranade said.
Mastek Group CFO and Finance Director Farid Kazani said the deal is a win-win situation for both companies.
"Now it has to been seen how iGate will capitalise and integrate the business of Patni Computer in order to take advantage of this," Kazani added.
"The deal is good for Patni, which for the last two years has been undergoing a period of uncertainty, giving it a clear roadmap for growth and competing with the bigger players," Gartner Senior Research Analyst Arup Roy told PTI.
But it is a better deal for iGate, since the combined entity will be worth almost a billion dollars, which can help swing large deals in its favour, he added.
A consortium of US-based iGate and Apax Partners today announced a deal to buy a nearly 63 per cent stake in mid-sized IT firm Patni Computer for about $921 million.
As per market regulator Sebi's guidelines, the iGate-led consortium now has to make an open offer for an additional 20 per cent stake in the firm, which will take the total value of the transaction to $1.22 billion (more than Rs 5,400 crore) if the share price of Rs 503 apiece is maintained.
"The combined size and scale will help the new entity compete for larger deals, especially with the top three players," Roy said.
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PriceWaterhouseCoopers Associate Director Abhijeet Ranade said the deal will help the companies optimise cost and performance of both the companies.
"I have always maintained that consolidation is inevitable in the industry. The deal will help both companies optimise cost and efficiency, as well as explore new verticals," Ranade said.
Mastek Group CFO and Finance Director Farid Kazani said the deal is a win-win situation for both companies.
"Now it has to been seen how iGate will capitalise and integrate the business of Patni Computer in order to take advantage of this," Kazani added.
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