A Gulf-based private equity fund has invested $98 million in the Middle East and Africa (MEA) business of Redington India Ltd for a 36% stake. Redington is a Chennai-based supply chain solution providers in the IT and telecom space. The deal values Redington's MEA business at
$272 million. The investment has been made by Investcorp Gulf Opportunity Fund.
Redington expects that the transaction will get completed by middle of November 2008. This will not be Redington's first brush with private equity as it sold off an 11% stake in 2006 for Rs 67 crore to Ashish Dhawan's ChrysCapital.
Redington Gulf began its operations in 1997 and has a workforce of 478 people. The Gulf arm has a presence in 17 markets, through 2872 Channel Partners and claims to be the largest and fastest growing IT distributor in the MEA. Some of its clients include Nokia, Cisco, Linksys, Microsoft, HP, i-mate, among others.
Redington came out with an IPO last year through which it raised Rs 150 crore. For its FY08 results, the firm reported net sales of Rs 10,870 crore and consolidated net profit at Rs 136 crore. Redington's current market capitalisation is Rs 1,713 crore. Redington also has operations in Singapore, Sri Lanka and Bangladesh.
Bahrain and London-listed Investcorp has $17 billion of assets under management. Investcorp has acquired and listed firms like design and distribution firm Gucci and jewelry and luxury goods retailer Tiffany. The money has been invested out of Investcorp Gulf Opportunity Fund, a $500 million fund.