Barings decides not to sell MphasiS stake

Lack of appropriate offer forces move.

After nearly four months of intense negotiations with a clutch of bidders, Barings India Investments today announced that it would not sell its 35 per cent stake in MphasiS-BFL, a Bangalore-based software company.

In a statement issued here today, the private equity investment firm said, "Given our strong customer franchise and robust growth prospects, we would not like to entertain any of the offers.

It is business as usual and the focus has to be on improving customer satisfaction, profitability and growth."

The announcement comes after the company evaluated proposals put forward by various entities. The MphasiS-BFL stock price lost 3.38 per cent to close at Rs 250.85 on the National Stock Exchange on Wednesday.

A private equity arm of the government of Singapore, Temasek Holdings, and BPO and information technology major Hinduja-TMT, were the front-runners to buy Barings' 35 per cent stake in MphasiS-BFL.

The bidding process, which started in May, also saw other contenders like Malaysia's Khazanah and US-based Carlyle. But they pulled out after showing an initial interest.

Barings was planning to exit its stake in the software company, an investment it made around seven years ago.

Even though Temasek had emerged the front-runner, its Rs 250-260 price did not enthuse Barings as the company was looking at a higher price of Rs 290-300 per share.

A strategic investor, Ernst & Young Capgemini, according to industry sources, was also interested in acquiring the stake.