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US-based Virtusa, which is looking to delist equity shares of Polaris Consulting & Services, has set an indicative offer price of ₹370 a share to public shareholders of Polaris.
This was decided considering various factors including, but not limited to, the capital allocation plan, availability of funds and cost associated with debt financing availed, according to a communication by Virtusa to the BSE.
At a 67.6% premiumThe indicative offer price was at a 67.6 per cent premium to the ₹220.73 an equity share (the takeover offer price) at which Virtusa acquired 78.65 per cent of the voting share capital of Polaris in March 2016, and a 59.2 per cent premium to the floor price of ₹232.37.
“We would like to obtain full ownership of Polaris, which will in turn provide us enhanced operational flexibility,” Ranjan Kalia, CFO & EVP, Virtusa, said. “A successful delisting will also provide an exit opportunity to Polaris shareholders especially given the low liquidity. The delisting price is determined by a reverse book-building process and Virtusa will have the option to accept or reject the discovered price.”
Kalia added: “We will accept the discovered price if it is reasonable and makes sense to Virtusa and its shareholders financially.The recent run-up in the stock price has raised concerns.”
After Virtusa set ₹370 a share as the indicative offer price, Polaris’ stock price on the BSE hit a 52-week high of ₹422, up 8 per cent in intra-day trade, and closed at ₹414.20, up 6.18 per cent.
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