Even as private equity majors continue to make the best of the rally in the Indian stock markets, they have lined two outsourcing companies for share sales. The two sales together could rake in over $200 million for the PE-backers of these companies, according to VCCircle’s analysis of the current share prices of these companies.
Business process outsourcing firm WNS (Holdings) Ltd has moved ahead with its offering and plans to sell 10.5 million American Depositary Shares (ADS) in an equal mix of primary and secondary offerings by Warburg Pincus. Private equity firm Oak Hill Capital Partners is also looking to completely exit ExlService Holdings, Inc., after halving its stake last year.
WNS had filed for a shelf registration statement with the Securities and Exchange Commission (SEC) in October last year in which Warburg Pincus was allowed to sell its entire 47.9 per cent stake over a period of time. In the current offering, Warburg Pincus is selling 5.25 million ADS, with an option to sell another 1.575 million shares in case of over-allotment. This accounts for nearly one-third of Warburg Pincus’ current stake or over 15 per cent stake in WNS.
The share price of WNS closed at $9.65 a unit on Wednesday, down 1.03 per cent on the New York Stock Exchange. At this price, Warburg Pincus could get nearly $66 million for its shares (including over-allotment). WNS is also raising primary capital through issue of 5.25 million ADS for general corporate purposes, which may include capital expenditures, acquisitions, debt refinancing and working capital.
In another development, NASDAQ-listed business processing outsourcing firm ExlService Holdings has made a shelf registration in which it will raise $180 million. These funds can be raised through common stock, preferred stock, debt securities, depositary shares, etc.
The shelf registration also allows Oak Hill Capital to sell its remaining 17.3 per cent stake in the firm. VCCircle reported in December that Oak Hill sold 17-18 per cent stake in the firm since September 2011, realising $120 million in the process. ExlService co-founders, former Bank of America executive Vikram Talwar and the current CEO Rohit Kapoor, are also selling part of their shares in this offering.
The share price of ExlService closed at $24.96 on Wednesday, up 3.4 per cent. At this rate, Oak Hill Capital could realise $138.34 million for its stake.
Oak Hill Capital, along with Financial Technology Ventures and ExlService management team, had acquired 100 per cent stake in the company from insurance firm Conseco, Inc. (now called CNO Financial Group) in 2002.