Financial Daily from THE HINDU group of publications
Thursday, Sep 11, 2003
Financial Daily from THE HINDU group of publications Thursday, Sep 11, 2003 |
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Info-Tech
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Mergers & Acquisitions Hexaware sells Mentorix stake Our Bureau
Mumbai , Sept. 10 HEXAWARE Technologies Ltd on Wednesday announced the disinvestment of its entire stake in Mentorix Technologies Inc to Lionbridge Technologies, a Delaware Corporation. The all-cash deal of $7.5 million (34.2 crore) resulting in a profit of $4.15 million for Hexaware would finance the Indian software company's growth plans. "We will use the money to finance growth opportunities which includes business consolidation, expansion of our infrastructure, employee ramp-ups and offering services in new verticals and horizontals," Mr Rajesh Ghonasgi, Chief Financial Officer, Hexaware Technologies Ltd, told Business Line. The Board of Directors of Hexaware Technologies met here and consented to go ahead with the disinvestment of Hexaware's stakes in Mentorix. "This sale represents successful investment and nurturing of a company focussed on niche areas within e-space. This strategic disinvestments of Mentorix will help Hexaware to re-focus our energies to becoming a world class global software solutions provider," a press release quoting Mr Atul Nishar, Chairman, Hexaware Technologies, said. The deal was concluded on the basis of the offer made by Lionbridge Technologies for cent per cent stock of Mentorix, including its wholly-owned subsidiary Mentorix Learning Technologies Private Ltd, India. According to Mr Ghonasgi, Hexaware would opt for the organic growth mode with emphasis on niche areas such as banking and finance, transport and PeopleSoft technology horizontals. Other plans include setting up of offshore development centres in new locations. This was, however, a just-in-time plan depending on the projects bagged, Mr Ghonasgi said. In early 2001, Hexaware had made an investment of $3.35 million comprising 1,11,87,727 common stock of $0.30 each in Mentorix Technologies. The valuation for Mentorix was done by Grant Thornton, a leading accountancy and business advisory firm. "At that time we made the investment because we had a e-learning business which was complementing Mentorix's offerings," added Mr Ghosangi.
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