The Hindu : Business : HCL to issue equity to Deutsche Bank

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Thursday, Nov 25, 2004

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HCL to issue equity to Deutsche Bank

By Our Special Correspondent

CHENNAI, NOV. 24. The board of HCL Technologies Ltd., on Wednesday, approved a preferential issue of 19.36 million equity shares of Rs.2 each fully paid up at a price of Rs.361per share to Deutsche Bank AG (DB).

The allotment is, however, subject to regulatory and related approvals.

The company has called for an extra-ordinary general body meeting of the shareholders to approve the allotment. The meeting is being scheduled for December 21.

The preferential allotment through fresh issue of shares is in lieu of cash that HCL Technologies owes to the bank for acquiring the latter's stake in DSI Financial Solutions Pte. Ltd. (DSI), Singapore. Deutsche Bank held 49 per cent stake in DSI Financial with HCL Technologies holding the balance. Once the transaction is through, DSI and its wholly owned subsidiary DSL Software will become wholly owned subsidiaries of HCL.

A spokesman of HCL Technologies told this correspondent in a telephone conversation from New Delhi that Deutsche Bank would have around 6 per cent stake in the company post-preferential allotment. The company currently has outstanding shares of around 297 million. It will bloat by an additional 19.36 million following the preferential issue.

Quizzed if this would see Deutsche Bank representative getting onto the board of HCL Technologies, he replied in the negative. He also said business would go on as usual at HCL Technologies post-preferential issue.

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