Persistent Systems has secured control of Nagarro SE after its takeover offer received shares taking its stake in the German IT services company to 83.25%, with HSBC Securities retaining a Hold rating on Persistent and a target price of Rs 5,000.
Persistent now holds 83.25% of Nagarro's outstanding share capital and voting rights. The stake comprises the 61.15% acquired through the recently concluded voluntary public offer and the 22.10% stake previously secured from Lantano Beteiligungen GmbH.
The development gives Persistent a clear controlling position in Nagarro, but the next threshold could be even more consequential. HSBC noted that Persistent has another two-week window from Sept 23 to Oct 6 to increase its holding further. Nagarro shareholders can tender their shares during this additional acceptance period at 81 euros per share in cash.
HSBC said crossing 90% ownership could open the possibility of pursuing a squeeze-out of remaining minority shareholders under German law. Such a move, if pursued and completed, could accelerate the integration of Nagarro into Persistent.
Persistent has also said it intends to pursue the delisting of Nagarro from the regulated market, or Prime Standard, of the Frankfurt Stock Exchange, as soon as practicable and legally feasible. The closing of the transaction is expected by the end of the first quarter of calendar 2027, according to the company's announcement.
Nagarro brings a complementary European presence, while the two companies have positioned the combination around AI-led engineering, digital transformation and broader global delivery capabilities. Nagarro's investor FAQ describes the proposed combination as creating an AI-led engineering business with more than 46,000 employees across over 40 countries.
For Persistent investors, HSBC's focus is now likely to shift from whether the takeover succeeds to how much further the stake rises, whether the 90% threshold is crossed and how quickly Nagarro can be integrated.
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