Aditya Birla Group sells BPO arm Aditya Birla Minacs to PE firms
31 Jan 2014
Aditya Birla Nuvo's wholly-owned infotech subsidiary ABNL IT & ITeS Ltd today said that it has entered into an agreement to divest its IT-ITeS subsidiary, Aditya Birla Minacs Worldwide Limited.
ABNL said it had signed a share purchase agreement with a group of financial investors led by investment holding company Capital Square Partners (CSP) and India-focused private equity fiirm CX Partners (CXP), to divest
Aditya Birla Minacs at an enterprise value of $260 million subject to the working capital adjustments.
The $4.75-billion Aditya Birla Nuvo entered the ITeS sector in 2003 through the acquisition of TransWorks, a $12-million company, which in 2006 acquired the $265-million Minacs in 2006.
Minacs which reported revenues of around $450 million (Rs2,466 crore) and net profit of $23 million in fiscal 2012-13, services global clients through 35 centers in 10 countries.
"To further expand its scale, enhance its competitive advantage and attain the next level of growth, Minacs requires capital investments," the company said in a statement.
It added, "Being a conglomerate, Aditya Birla Nuvo constantly evaluates its capital allocation strategy and reviews its business portfolio. Given the multiple growth opportunities and ensuing capital requirements at ABNL, the company decided to divest Minacs to a strategic financial investor, with extensive domain experience, who can ensure that Minacs continues to progress forward on its strategic roadmap."
''Considering ABNL's capital commitment and growth plans for other businesses, the company has decided to divest Minacs," said Dr Rakesh Jain, managing director, Aditya Birla Nuvo.
Sushil Agarwal, whole time director and CFO, Aditya Birla Nuvo, said, ''The cash flow from the divestment of Minacs will support the growth plans of Aditya Birla Nuvo and ensure its greater focus in the other businesses.''
The deal is expected to be concluded within three months, subject to customary closing conditions, third-party consents and regulatory approvals, the company said.