Patni issue oversubscribed 22 times

The initial public offer (IPO) of Patni Computer Systems has been oversubscribed 22 times. The company is raising $95 million - which is the largest thus far by a software company in the last four years. In 1999, HCL Technologies had come out with a $182 million issue.

Amit Chandra, member of the board, DSP Merrill Lynch, said, "The overwhelming response to the Patni book-built issue during the extremely choppy secondary market environment shows strong investor appetite for high quality Indian paper."

"After 18 months, a large tech sector IPO hit the market in the shape of Patni. It has received a very good response from discerning investors. We are extremely happy," said S Ramesh, Kotak Investment Banking

While the exact price at which the allotments will be made will be known only next week, most of the bidding came in at the Rs 200-230 price band.

The company is offering 13.4 million shares while 5.32 million more are being sold from founders and other shareholders including investment units of General Electric Co.

The shares which are being sold make up around 15 percent of its post-issue capital.

Recently the IPOs of TV Today and Indraprastha Gas were oversubscribed by around 35 times.

GE has a 10 per cent stake in Patni and relies on the US company for about 45 percent of its revenues.

The holding of Patni's promoters is expected to decline to 51.3 percent from 60.8 percent after the public issue. Other investors such as GE and US private equity firm General Atlantic Partners, which invested $100 million in Patni, will see their stake fall to 33.7 percent from 39.2 percent.