Patni close to buying European firm for $45 mn

Not content with the recent $25-million takeover of Logan-Orviss International, Patni Computer Systems is scouting for more acquisitions.

The IT major is in the final lap of a $40-45 million (about Rs 160-184 crore) acquisition in Europe which will be announced in the next couple of months.

The acquisition assumes importance as two private equity majors, Texas Pacific Group and Apax Partners, have been reported to be in an advanced stage to acquire a 20 per cent stake in the company held by two of its largest shareholders, Ashok Kumar Patni and Gajendra Kumar Patni, who together own 29 per cent.

"Patni is in an advanced stage of negotiations to acquire an enterprise application service provider in Europe. The company has completed the evaluation process, and the formal signing of the contract is expected to close within four-six weeks," a source close to the development told Business Standard.

Without revealing the name of the target company, the source said that the deal would be about $40-45 million. The company is expected to make an announcement in the next two months. When contacted, executives with the IT major declined to comment.

The acquisition will strengthen Patni's foothold in the European market, and increase its presence in the enterprise application market, including enterprise resource planning.

This is the third acquisition by the company which is India's sixth largest IT firm.

In July, Patni acquired Europe-based Logan-Orviss International (LOI), a leading independent specialist telecommunications consulting services company. The IT major did not disclose the cost of acquisition, but industry analysts pegged it at about $20-25 million.

In June last year, Patni acquired US-based ZAiQ Technologies, an application-specific integrated services design firm in an asset purchase transaction of $425,000.

ZAiQ provides outsourced design services and software products to companies developing complex, high-performance systems and integrated circuits.