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Hewlett-Packard, the majority owner of Mphasis, has revived plans to sell its stake in the Bangalore-based listed information technology services company with a recovery in the stock market.
Sources said the US-headquartered technology major had given UBS the job of finding a suitor for Mphasis. Hewlett-Packard holds 60.49 per cent in Mphasis worth Rs 5,333 crore at Tuesday's price of Rs 419 a share on the BSE.
Infotech companies and private equity players have shown interest in buying Hewlett-Packard's stake in Mphasis. Prominent among these are Japanese technology companies NEC and Fujitsu.
Mphasis launched a new tag line in February, in which it switched from 'an HP company' to 'unleash the Next'.
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Mphasis declined to comment on a specific query. Shari McCullough, Hewlett-Packard's director for analyst and public relations for the Asia-Pacific and Japan said, "H-P does not comment on rumour or speculation". A UBS spokesperson also declined to comment on the report.
Hewlett-Packard is not only Mphasis' promoter, it is also its largest client giving it 40 per cent of its revenue.
Mphasis' business from Hewlett-Packard has been declining for several quarters amid speculation of the stake sale.
For the financial year ended October 31, 2013, Mphasis reported Rs 5,796 crore in revenue, of which direct sales accounted for 60 per cent.
Ganesh Ayyar, chief executive officer of Mphasis, had said after the rebranding that it would have no impact on Hewlett-Packard's shareholding or Mphasis' relationship with it as a client. "In September (2013), we had a strategic session with our board, which includes representatives of Hewlett-Packard, and they are fine with the re-branding. In fact, we have full backing from them as they also want to see us evolve and grow," he had said.
Mphasis has made several changes over the years to arrest this declining revenue from Hewlett-Packard as well as to expand direct channel sales. It is narrowing its focus to a few industries such as banking, capital markets and insurance. Last year, the company sold its government infrastructure business.
Mphasis had earlier said it was working towards reducing its dependence on Hewlett-Packard as a client. The company is redeploying employees working on various Hewlett-Packard projects.
