The Hindu : Business : MphasiS board supports EDS open offer

Online edition of India's National Newspaper
Wednesday, Apr 05, 2006

Business

Business

MphasiS board supports EDS open offer

Special Correspondent

EDS offers to buy 52 per cent stake in MphasiS at Rs. 204.50 per share in all cash deal

BANGALORE: The board of directors of MphasiS BFL Limited has supported the conditional offer made by U.S. technology giant Electronic Data Systems Corp. (EDS) to acquire a controlling stake in the Bangalore-based software services and BPO firm for $380 million.

"The offer from EDS is a positive endorsement of the company's strengths. The board will fully support whatever action shareholders take with respect to this offer,'' the board resolved during a meeting held in New Delhi on Tuesday.

The board further acknowledged that a partnership with EDS will enable the company to broaden its offering to its customers and provide enhanced prospects to the employees.

The company management has endorsed the offer made by Texas-based EDS on Monday to buy 83 million shares, translating into a majority stake of 52 per cent at Rs. 204.50 per share in an all cash deal. The offer price represents a premium of about 30 per cent to the 26-week average price of MphasiS.

"We are supportive of this transaction and look forward to its successful closure ,'' said Jerry Rao, Chairman and CEO, MphasiS.

"This offer is complementary to our overall strategy to enhance EDS' presence and capabilities in India,'' said Mike Jordan, Chairman and CEO of New York Stock Exchange-listed EDS that is credited with founding the IT outsourcing industry more than 40 years ago.

If the conditional open offer sails through, it will be the second largest deal in the Indian software services sector after U.S.-based business software maker Oracle Corp paid $593 million in August last to buy 43 per cent stake held by Citigroup Venture Capital International in Indian banking software vendor i-flex Solutions.

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