Online edition of India's National Newspaper
Wednesday, Oct 06, 2004

About Us
Contact Us
Business
News: Front Page | National | Tamil Nadu | Andhra Pradesh | Karnataka | Kerala | New Delhi | Other States | International | Opinion | Business | Sport | Miscellaneous | Entertainment |
Advts:
Classifieds | Employment |

Business Printer Friendly Page   Send this Article to a Friend

Intelligroup completes private placement of shares

By Our Special Correspondent

CHENNAI, OCT. 5. A consortium comprising Venture Tech Assets Private Ltd., promoted by the co-founder of iLabs, and Softbank Asia Infrastructure Fund, a private equity fund, has picked up 50.3 per cent stake in Nasdaq-listed Intelligroup, a player in strategic IT outsourcing service with good presence in India.

This follows the completion of $15-million private placement of 1.76 crore shares of Intelligroup's common stock at a purchase price of $0.85 per share. Post-private placement, Venture Tech will hold 20 per cent stake and Softbank 30.3 per cent in Intelligroup.

Following the deal, the duo will have five nominees on the nine-member board of the U.S. firm. Simultaneously, Intelligroup has amended its credit facility with PNC Business Credit. This includes waiver of default earlier announced by the company. The company stock was quoted at around $1.79 on October 4. In a filing with Nasdaq, Intelligroup has reported revenue of $118 million for 2003.

Analysts are surprised at the price paid by the consortium. This, however, has to be viewed in the backdrop of the trouble that Intelligroup is through now. According to its own filing with Nasdaq, Intelligroup admitted that it was now ``trying to remedy a financial disclosure process deemed ineffective because it did not provide information required for public disclosure under federal securities laws.''

Mr. Sandeep Reddy, who promoted Venture Tech, told this correspondent over phone from Hyderabad that the consortium saw in Intelligroup an opportunity. He said the duo was there for a longer-term.

Printer friendly page  
Send this article to Friends by E-Mail

Business

News: Front Page | National | Tamil Nadu | Andhra Pradesh | Karnataka | Kerala | New Delhi | Other States | International | Opinion | Business | Sport | Miscellaneous | Entertainment |
Advts:
Classifieds | Employment | Updates: Breaking News |

BL Mumbai Launch


News Update


The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | Home |

Copyright 2004, The Hindu. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu