MphasiS

2016: HPE sells the company to Blackstone Group fund

On April 4, 2016 Hewlett Packard Enterprise (HPE) announced sale of the IT outsourcer of MphasiS belonging to the company. The cost of the transaction will exceed $1 billion.

Hewlett Packard Enterprise sells at least 84% of the shares of MphasiS of the American investment company Blackstone Group at the price of 430 rupees apiece that there correspond about $825 million. The remained 16 percent share will be sold within the so-called obligatory tender offer. In case of its approval, Blackstone will pay for MphasiS purchase in total about $1.1 billion.

HPE sells the Indian IT outsourcer of MphasiS for $1.1 billion

To the transaction with Blackstone of Hewlett Packard Enterprise company 60.5% of securities of MphasiS belonged. It is going to complete sales process of this share in the second half of 2016 financial year (will come to the end at the end of October of the 2016th calendar). The profit of Hewlett Packard Enterprise in $75 million from sale of a share in MphasiS will be considered in results of the American corporation for 2015. Hewlett Packard Enterprise is not going to change the forecast for an annual operating profit margin in 6-7% as a result of sale of the Indian outsourcer.

In media repeatedly there was information on plans of Hewlett Packard Enterprise to sell the share in MphasiS. By hearsay, the Indian L&T Infotech and the Japanese NEC, private investment firms Carlyle Group and Advent International and also Tech Mahindra and Apollo Global Management were interested in this company.

According to sources of Reuters agency, the Blackstone company was a favourite at an auction for MphasiS sale, and Hewlett Packard Enterprise decided to carry out it for the purpose of building of the capital. The analyst of Macquarie Group of Rajesh Ghai assumes that the American company will let the means obtained from the transaction to share repurchase of stocks.^[1]

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