In a strategic move to access AIG (American Insurance Group) for its IT outsourcing business, Chennai based Polaris Software Lab today sold its stake in one of AIG Group companies -- AIG SS in which it was a joint venture partner holding 20 per cent stake for Rs 23.26 crore.
With this deal completed, Polaris will now be able to access all of AIG and its subsidiaries IT services needs by competing with other IT services company on an even platform.
The deal would also give a boost to Polaris’ bottomline this year. Polaris had entered into the JV with AIG for holding the 20 per cent stake in AIG SS for Rs 3.26 crore in 2002. This sale leaves a profit on sale of investment of Rs 20 crore for Polaris on a standalone basis and Rs 13.21 crore on consolidated basis, said a company executive.
This profit will be reflected in the current quarter’s results and will be over and above 10 per cent growth in profit given in its latest guidance call for the quarter, said R Srikanth, chief financial officer, Polaris.
“By selling our stake in an AIG Group company, we have effectively removed a hurdle that did not allow us to access the great opportunities AIG Group was offering. Now we can bid for AIG’s global IT outsourcing business like any other IT services company anywhere in the world.”
Technically this also includes Tata AIG in India, a joint venture between Tata Group and AIG. Tata group too has a strong presence in the IT services sector through Tata Consultancy Services. Polaris Software Lab today closed at Rs 103.75 on NSE, which is 0.73 per cent higher than yesterday's close.
