ITC shares are surging in trade on Tuesday after the announcement of its IT services arm acquiring a 22.1% stake in Happiest Minds Technologies for Rs 1,330 crore, according to an exchange filing.
Shares of ITC surged as much as 4.70% to a high of Rs 267.50 intraday.
The transaction values Happiest Minds at Rs 405 per share, or around Rs 6,167 crore, while ITC Infotech has been valued at Rs 1,312 per share, or around Rs 11,920 crore.
Under the proposed share-swap arrangement, Happiest Minds shareholders will receive 25 ITC Infotech shares for every 81 shares held in Happiest Minds.
Following the merger, ITC Ltd is expected to hold around 73.4% of the combined entity, while existing Happiest Minds shareholders will own approximately 26.6%.
The combined business is expected to benefit from increased scale, with Americas revenue targeted to double. The companies are also targeting synergies of around 10% of revenue, along with an estimated 100-basis-point expansion in margins.
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