Datamatics Global shareholders say ‘no’ to Cignex deal

Our Bureau Chennai | Updated on January 22, 2020

Both promoters and public shareholders of Datamatics Global Services Ltd (DGSL) have rejected a proposal by the company to divest its stake in Cignex Datamatics Inc.

Of the promoters vote, 96.6 per cent rejected the resolution. Among the public those participated, institutions rejected the deal en masse while 98.84 per cent of non-institutional investors voted against.

The global IT & BPM company, on December 12, 2019, had announced a proposal to divest of its stake in Cignex Datamatics Inc to Relevance Lab, a Singapore-headquartered IT Services company, through a share-swap arrangement.

Datamatics Global Services is holding 62.51 per cent stake in Cignex Datamatics Inc, its step-down subsidiary. Cigenex contributed to 17.27 per cent of the total turnover of DGSL.

Had the deal happened, the step-down subsidiary would have held 21 per cent of the total stake in the combined entity.

DGSL has today said that the deal to divest stake in one of its subsidiaries, Cignex Datamatics Inc, could not be completed as shareholders did not approve the proposed resolution.

“The parties are reworking on the revised structure and commercial terms, as a result of which the current share purchase agreement is likely to undergo a substantial change,” DGSL said in a notice to the stock exchanges..

Rahul Kanodia, CEO, DGSL, in the notice said; “We are working together on revised terms, and are confident that it will be beneficial for our company and its shareholders.”

Cignex Datamatics Inc is a US-headquartered IT Services firm offering, open source, cloud and automation services.

On Wednesday, the shares of Datamatics Global slipped 2.24 per cent to close at ₹76.5, on the BSE.

Published on January 22, 2020

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