HCL denies founder wants to sell stake

Shiv Nadar owns 62% in HCL Technologies, valued at $16.6 billion

Reiterating its oft-repeated stand that the company is not on the block, India’s fourth-largest software and outsourcing firm HCL Technologies denied a Wall Street Journal report which said the company’s founder Shiv Nadar was sounding out potential buyers for his $10-billion stake in the firm.

“HCL Corporation denies any plans to exit HCL Technologies,” the holding company of HCL Technologies said in a statement to Business Standard.

This comes just a month after HCL partnered with US-headquartered information technology (IT) firm Computer Sciences Corporation (CSC), a company it competes with. The alliance had triggered a strong buzz of an eventual merger of the two firms, which have not worked out a legal structure for the partnership. At that time, industry experts had said that the “re-purposing of the existing facilities” to deliver the services for the partnership could possibly result in one integrated company in the future.

The WSJ report is based on information by two unidentified people who claim to be briefed on the matter and said the company was yet to hire bankers to advise on a sale.

“Nadar has received bids for HCL in the past but has long said that he has no plans to sell. But now, the 69-year-old is open to considering selling his stake because his only child, daughter, Roshni Nadar, isn't interested in continuing in the technology business, one of the people said,” the report said. Roshni Nadar, 32, is a director on HCL's board and CEO of HCL Corp, it added.

‘All rubbish’
The talk of Shiv Nadar selling off his stake has been doing the rounds for almost a year now. In the past, market speculation was rife that HCL was in talks with its larger rival Accenture for an acquisition. In July 2013, when asked about rumours of a possible acquisition of HCL by a large multi-national IT player, HCL chief Anant Gupta had told Business Standard: “It is all rubbish.” After the CSC alliance was announced in January this year, Gupta had again said: “There is absolutely no M&A (merger and acquisition) and no inorganic play.”

Shiv Nadar owns about 62 per cent stake in HCL Technologies, which is valued at $16.6 billion. The company’s stock rose by 2.92 per cent to close at Rs 1,538.25 on a day when the benchmark BSE was up 164.11 points to end the day at 20,700.75 points.

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