Continuing its acquisition-spree in the IT and BPO space, diversified conglomerate Essar Group today announced it will buy majority stake in AGC Networks from Avaya of the US for $44.5 million (Rs 206.19 crore).
The deal would catapult the Essar Group's IT and BPO arm Aegis among the top five IT solution providers along with IBM, Wipro and TCS in the country.
"We have entered into a definitive agreement, under which the Essar Group would acquire Avaya's entire 59.13 per cent stake in BSE/NSE-listed AGC Networks for Rs 206.19 crore, or Rs 245 a share, subject to regulatory requirements and completion of the open offer," Essar said in a release.
The acquisition would be done through Essar Services Holdings. The company will come out with an open offer for an additional 20 per cent stake at a price determined as per the formula specified in the Sebi takeover code.
The company will make a mandatory public announcement tomorrow on the deal. Assuming all shares are tendered in the open offer, total size of the offer would be about Rs 78 crore.
AGC Networks, earlier known as Avaya Global Connect, is a converged communication solutions provider focused on the India and Australian markets and employs nearly 500. The current management is expected to continue and spearhead the business post-closing, the company said.
Commenting on the deal, Essar Group's IT arm Aegis MD and global CEO Aparup Sengupta said, "Essar in a short span has become a key player in solutions integrator space and would benefit immensely from the depth and width of expertise AGC Networks has. We have a definitive plan to grow this business as we aim for bigger chunks of customer spends."
Essar Services Holdings is the group company having investments in Aegis, which is an outsourcing services partner for over 135 clients and with over two decades of experience in total customer lifecycle management.
Aegis has over 39,000 employees across 42 locations in ten countries, serving verticals such as telecom, healthcare, travel and hospitality, consumer goods, retail and technology.
AGC Networks is a leading player in contact centres, unified communications and networking as solutions integrator with a roster of marquee clients and cutting edge products.
Edelweiss Capital is the sole advisor to the deal and is the manager to the open offer.
"It provides a great synergy with our systems integration business. With this acquisition, we will gain deep expertise in the 'enable' block of experience management that we embarked on through our worldwide expansion drive. Now our customers will have the ability to have unified communication and experience management under one roof," Essar said.
