Public-listed Modern India Ltd has signed a deal to acquire 76 per cent equity stake in Bangalore-headquartered human resource consulting firm Verifacts Services Pvt Ltd for Rs 28 crore ($4.5 million), marking its foray into the employee verification service business, as per a disclosure on the BSE.
Modern India has signed a share purchase agreement to acquire 380,000 equity shares of with Verifacts Services aggregating to 76 per cent of the paid-up share capital of the privately held company.
"The acquisition of the verification services businesses is a value enhancing and forward-looking initiative for Modern India. We have been clear about our intention to focus on growth initiatives in India and international markets, which together are expected to be key drivers for future growth. This transaction will complement our strategy of pursuing organic growth along with value-creating acquisitions within our served markets and adding complementary growth platforms to provide scale and revenue diversity," Modern India Chairman Vijay Kumar Jatia said.
ING Vysya Bank Ltd acted as an exclusive financial advisor to Modern India Ltd.
Founded in 2003, Verifacts offers background/antecedents verification services with seven branches. The company specialises in the field of candidate authentication program, apart from providing services like address verification, education verification, employment verification, criminal background verification, international database, drug test.
On the other side, Modern India is a small corporate house with diverse interests ranging from real estate, textiles, gems and jewellery to education, as per the information available on its site. Presently, it has offices in four cities across three countries.
In another deal in the HR consulting space, last year Fairfax-controlled travel services firm Thomas Cook had acquired 74 per cent stake in Ikya Human Capital Solutions for Rs 256 crore, which also marked an exit for India Equity Partners.
(Edited by Joby Puthuparampil Johnson)