Shares of the IT solutions company Coforge nosedived by as much as 10 per cent in Friday’s trade after the company made a mandatory open offer to the shareholders of Cigniti Technologies to buy 54 per cent stake in the latter.

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“Open offer for the acquisition of up to 71,62,210 fully paid-up equity shares of face value of Rs 10 each, representing 26 per cent of the Expanded Voting Share Capital (as defined below) of Cigniti Technologies Limited (“Target Company”) from the Public Shareholders (defined below) of the Target Company by Coforge Limited (“Acquirer”) and Coforge Pte. Ltd. (“PAC”) acting as a person acting in concert with the Acquirer, with an intention to acquire control of the Target Company, pursuant to and in compliance with the requirements of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 and subsequent amendments thereto (“Takeover Regulations”) (“Offer” / “Open Offer”),” said the company’s filing with the exchange. 

Furthermore, the offer is priced at Rs 1415 per share and assuming acceptance of the offer, the total consideration payable by the acquirer or PAC  will come to be Rs in accordance with the Takeover Regulations will be Rs 10,13,45,27,150, added the company filing.

Coforge believes that the acquisition of Cigniti will not only help it grow into a USD 2 billion firm by FY27 but equally importantly the ensuing synergies will ensure that the Coforge operating margins shall improve by 150 – 250 bps in that timeframe too.

At the day’s low, the stock hit a price of Rs 4505.25 as against the previous closing price of Rs 4986.10 per share on the BSE. The manager to the open offer by the company is IIFL Securities.