Infogain to acquire Blue Star Infotech IT biz for Rs 181 cr

Blue Star Infotech Ltd (BSIL) today said Infogain Inc, a ChrysCapital portfolio company, will acquire its IT business for Rs 180.80 crore.
The combined entity will have revenue of over USD 150 million, close to 4,000 employees and multiple global delivery centres, BSIL said in a BSE filing.
It will provide customers with digital transformation platform with capabilities in cloud, mobility, SAP, analytics, product engineering and test automation from locations in the US, the UK, Middle East, Singapore, Malaysia and India.
"The aggregate consideration for the IT business of BSIL (Rs 81.70 crore) and its subsidiaries in USA (Rs 36.50 crore), UK (Rs 21.80 crore) and Singapore (Rs 40.80 crore) under the transaction will be Rs 180.80 crore, payable upon completion of the sale," it said.

BSIL would retain a real estate undertaking, a certain amount of cash and tax receivables, it added.
The fair value of these net assets to be retained by BSIL is expected to be around Rs 96.7 crore.

The company's net revenue for the quarter ended June 30, stood at Rs 40.85 crore, while for FY14-15, the same stood at Rs 138.21 crore.
In a separate filing, BSIL said the Board has decided to purchase the entire business of the company's wholly-owned subsidiary Blue Star Infotech Business Intelligence and Analytics by October 31 for Rs 6.5 crore.
"Following the completion of the sale, it is proposed to merge BSIL with Blue Star with effect from April 1, 2015 under the provisions of section 391-394 of the Companies Act 1956 through a court approved scheme of amalgamation," the statement said.

BSIL said the landscape of the IT industry has evolved significantly in the last five years and the technology and business focus has shifted to specialised verticals and delivery options that require large scale and a global footprint.
"While BSIL has achieved significant growth, doubling its revenue between 2011 and 2015, it now needs enhanced access to technology and global markets and a significant capital infusion to invest in building new-age differentiated solutions and remain competitive in the ever-evolving technology landscape," it added.
The company said private equity firm ChrysCapital, which recently acquired a majority interest in Infogain, would support them financially for this transaction and provide the combined entity the necessary global reach and growth capital going forward.