Baring Asia adds leverage to Hexaware acquisition

HT Global owns more than 185 million Hexaware shares, giving it a 62% stake in the company. According to a filing with the Bombay Stock Exchange, all those shares had been pledged as of December 3. More than 60 million shares are now held in pledge by Standard Chartered Bank Hong Kong. It is not known who holds the remaining shares.

Set up in 1990, Hexaware provides IT, BPO and consulting services. According to its website the company has revenue of $ 364 million in revenue for the financial year 2013. It is headquartered in Mumbai and has regional headquarters in New Jersey, London and Singapore.

Baring first invested in Hexaware in August when it acquired a 41.8% holding from the founders and General Atlantic for around INR16.87 billion ($273 million) . The firm then bought an additional 20% stake for INR8.16 billion through an open offer last month. Baring now has over 71% of the company, including ChrysCapital's 9.5% holding.

The PE fund invested a part of the total acquisition cost from their equity fund and part by pledging the shares they bought with a foreign lender.

Control deals in India do not typically follow the traditional leveraged buyout model of using debt to multiply returns on equity. Buyouts of IT companies, where clients are primarily based in the US and Europe, have all used leverage. This is driven by the fact that if there are cash flows overseas they can be used to service overseas debt which is US dollar-denominated and therefore cheaper.

 

 

 

 

 

 

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• Topics
• South Asia
• Buyouts
• Technology
• Leveraged finance
• Technology
• India
• Baring Private Equity Partners India