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Moumita Bakshi Chatterjee

New Delhi, Oct. 11 Even as Infosys has withdrawn from the race to acquire Axon Group, HCL Technologies —currently the sole bidder for the UK-based SAP consulting firm — is still not ruling out the possibility of a third player jumping into the fray.

“Sure, there is a possibility. One cannot rule out such a possibility in an open acquisition process. In theory, a new player can walk-in within 45 days from the day we post our scheme document,” Mr Vineet Nayar, CEO of HCL Technologies, told Business Line.

His comments come a day after Bangalore-based Infosys Technologies decided not to increase its original 600-pence offer for Axon, and HCL moved a step closer to its target by announcing plans to implement its £441 million cash offer through a ‘Scheme of Arrangement’.

This scheme would be posted by Axon for its shareholders around October 24, and going by the current timetable, the deal is expected to be completed before the year-end.

HCL has already tied-up a £400-million loan from Standard Chartered with the interest cost pegged at 6.4-6.7 per cent. “Overall, we are hoping to switch this over and do even a lower cost debt structure…When we say 6.4-6.7 per cent interest cost, this could go up or down based on the LIBOR, but the 3.5 per cent differential with the treasury income will always remain… I think there will be a lot of attractive options available post December-January,” he said but declined to specify the company’s plans for lowering the cost of debt.

It may be recalled that Infosys, which first made a bid for Axon late August, had put a £407-million offer on the table. However, Delhi-based HCL Technologies trumped that bid with its own offer of 650 pence per share, an eight per cent premium over Infosys’ offer.

In the light of HCL’s higher offer, the Axon board — which had initially backed Infosys’ bid — withdrew its recommendation and supported Delhi-based HCL’s offer to its shareholders.

More Stories on : Software | Mergers & Acquisitions | HCL Technologies Ltd

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