| This failed bid may now trigger changes in the senior management. "If you are a smart investor, you try to lower prices," the official said, noting potential buyers raised the bogey of performance inconsistency to beat down the price, forcing Barings to call off the stake sale. The less-than-glorious track record had put Barings on a weak wicket, he said. |
| There is some speculation that Barings may now be keen to initiate plans for an American Depositary Receipts issue from MphasiS as part of its plans to exit from the company. |
| "We will have to see now. If possible, we should accelerate... grow faster," the official said without confirming or denying the move. But it is unlikely Barings would initiate any other stake sale effort in the near term. |
| MphasiS' bottomline has been marred by lacklustre performance either its information technology services arm or its BPO unit. MphasiS chairman Jerry Rao summed it up best when in a post earnings call in April this year he admitted that 2004-05 was a difficult year for the company's businesses. |
| "We had our share of ups and downs, left and right stuff as you know... BPO seemed to be holding us but this last quarter the roles have reversed a little bit." |
| The company had to revise its earnings guidance downwards for financial 2004-05 during the last quarter only three months after its chairman said the firm would beat its full-year projections "handsomely." |
| For the 2005-06, the company expects revenues and profits to rise 25 per cent and 30 per cent, respectively. On a consolidated basis, MphasiS BFL reported a sequential growth of 7.1 per cent and 8.8 per cent in revenues and profits, respectively, for the June quarter of this financial year. |
| Prior to Wednesday's announcement, there were reports that Hinduja TMT and Singapore-based Temasek Holdings were in the race to pick up the stake. |
| Hinduja TMT was keen to pick up a 51per cent stake in the company, possibly by buying out ChrysCapital's stake. Hinduja TMT officials had said they would not want to depend on the public offer route to raise their stake beyond the 51 per cent mark. |
| Temasek is believed to have scaled down its initial offer, leaving Barings with little option but to reject it. |
| Barings, the official said, was keeping itself out of the loop for the past three months that it was trying to find a suitor for its stake. |
| "They will now roll up their sleeves and get into it (operations)." The official said the company could now see some top-level management changes as part of the plans to rev-up the growth engine. |
| Earlier this month, the company's chief financial officer, Ravi Ramu, put in his papers. He hinted that more changes are on the anvil such as on the delivery side of IT services. "There will be some additions and deletions." |
| It is not known how the customers are likely to react to the recent events at the company, although officials maintain that it is business as usual. An analyst at a local brokerage said the stock has erased much of the gains it posted following the earlier reports of stake sale. "It will now depend on the fundamentals." |
| On March 31, 1998, after the acquisition of the then BFL Software from the Bangur Group, Rahul Bhasin, who was the managing partner with Barings India Investments Ltd had told this correspondent that he was even accused of being "foolhardy" by his colleagues for deciding on acquiring the company. |
| Bhasin continues to head the India operations as the managing partner of Barings Private Equity Partners. BFL was BIIL's first investment in India. |
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