Blackstone-backed BPO firm Intelenet Global, has made an offer to buyout 25.06% it does not own in stock exchange-listed outsourcing firm Sparsh BPO Services Ltd with a floor or minimum price of Rs 68.6 per share. But the price payable will be determined through the reverse book building process will not be less than the price at which the maximum number of Equity Shares have been tendered or the discovered price.
The floor price is about 25% lower than the current price. Earlier, it had offered to buy the shares at Rs 80 each. At that price, a 25% stake will cost Intelenet-SKR BPO around Rs 32 crore ($7 million).
The offer opens January 31 and closes on February 4.
This comes close on the heels of Barclays announcing that it is picking a 12% stake in Intelenet, marking a return to the company as an investor. The British Bank, that is already one of the largest clients of the firm, is said to be picking fresh shares in SKR BPO Services.
Barclays and Housing Development Finance Corp (HDFC), had sold their stake to Blackstone in a management buyout for $200 million and have bought back into the company. Blackstone held 80% stake while the remaining 20% was with the management after the MBO was concluded in 2007. Post Barclays transaction, Blackstone will own 66.25% while the management will have a 16.5% holding. HDFC now holds a 4.5% stake.
HDFC along with Tata Consulting Services (TCS) had set up Intelenet as a 50:50 joint venture back in 2000. But HDFC acquired TCS’ 50% stake in Intelenet for Rs 161 crore in July 2004 and sold it a month later to Barclays for Rs 164 crore.
Intelenet is taking Sparsh BPO private even as there have been reports that it may itself go public. A Reuters report had said last year that the firm may look at raising funds in an initial public offering in 1-2 years.
This will be the second such deal where a private equity (PE) firm or a PE backed firm is taking a company private, a phenomena which is quite common in the developed markets but largely absent in India. Actis is in the process of acquiring a part of the business of its own portfolio company Halonix. While Halonix is a listed company, Actis is buying out the low margin general lighting business leaving the listed firm with profitable automotive lighting business.
The strategy behind this could be to improve operations and make it a financially stronger firm at a private level before looking to sell it out to a strategic buyer in the future.