iGate's offer to delist Patni Computers ends today. Here are 10 quick facts on the delisting offer.
1) iGate's offer to delist Patni Computers and the reverse book building procedure for that purpose ends today.
2) So far, Patni has received offers for 1.56 crore shares at Rs 520 per share, which accounts for 59% of the offer. Patni needed 50% of the tender for offer to go through.
3) It needs to be seen whether iGate will agree to such Rs 520 per share or not. "My personal view is that iGate will agree to the price of Rs 520 per share as that will help iGate to completely delist Patni and synchronise the business operations of the both the companies. At this price of Rs 520 per share, the total payment that needs to be made by iGate for this delisting works out to about Rs 1,394 crore," Jagannadham Thunuguntla, Strategist & Head of Research SMC Global Securities Ltd said.
4) However, if in case iGate rejects this price of Rs 520 per share, then there is a good chance of significant correction in the stock price of Patni shares back to the level of Rs 380 per share. (Before the announcement of delisting, Patni shares were trading at Rs 380 per share.)
5) iGate had acquired majority stake in Patni computers in May 2011 for US $1.2 billion at Rs 503.50 per share.
6) There were lots of viewpoints in the market regarding the possible price that will get identified in the Reverse Book Building procedure.
7) The company has indicated a floor price of Rs 356.74 per share for the Reverse Book Building purposes.
8) Further, the company has consistently stated that they are comfortable with the delisting price close to Rs 450 per share.
9) Despite those company statements, markets have firmly believed that the eventual delisting price will be at least Rs 503.50 per share, which is the price at which iGate had acquired majority stake in Patni Computers.
10) On the basis of the response that is happening in the Reverse Book Building process suggests that the maximum bids came at Rs 520 per share.
(With inputs from SMC note on iGate-Patni delisting)
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