US-based Virtusa on Thursday announced to buy majority 53 per cent stake in Chennai-based Polaris Consulting and Services for about Rs1,173 crore.
The combination will equip Virtusa to provide end-to-end global banking and financial services and solutions and pursue larger consulting and outsourcing opportunities.
According to the agreement, a subsidiary of Virtusa will acquire about 53 per cent of the paid up share capital from certain promoter entities, led by Arun Jain, and certain other shareholders, including OrbiTech (formerly known as Orbitech limited), Virtusa said in a statement.
Virtusa will purchase shares at a price of about Rs220.73 apiece, aggregating to about Rs1,173 crore, it added.
“In addition, Virtusa will make an unconditional mandatory offer to the public shareholders of Polaris to purchase up to an additional 26 per cent of the outstanding shares of Polaris,” it said.
The deal will expand presence in key markets and enhance the ability to pursue larger consulting and outsourcing contracts, the statement said.
Polaris Consulting and Services had posted a net profit of Rs 47.34 crore, while its income from software development, support and BPO services stood at Rs517.67 crore in the July-September 2015 quarter.
The deal was announced after trading hours. Polaris shares closed at Rs204.50 apiece, down 1.02 per cent from previous close, on the BSE.
“I am delighted to have identified Kris Canekeratne and his team at Virtusa to pass on the baton to grow Polaris by offering greater value to customers and more opportunities for the team,” Polaris Consulting and Services Chairman Arun Jain said.