HCL Tech makes $811 million counterbid for UK's Axon
26 September 2008
Mumbai: Software services company HCL Technologies Ltd has launched an $810.8 million (441.1 million pounds) counterbid for UK-based SAP consulting company Axon Group Plc, trumping a $750 million (407 million pounds) bid by Infosys Technologies.
HCL has offered to pay 650 pence in cash for each Axon share against Infosy Technologies' offer of 600p a share.
Under the terms of the offer, Axon shareholders will receive 650 pence in cash for each Axon share valuing the entire issued and to be issued share capital of Axon at approximately £441.1 million.
''HCL's transformation journey enters an exciting phase where we are creating partnerships with high performance teams to become significant in our chosen areas of growth. We see Axon as one such transformational opportunity for HCL to become a significant player in the SAP services space. I am excited about the high performance and employee centric cultural synergy between HCL and Axon that would help accelerate the process of integration between the two teams'', said Vineet Nayar, CEO and member of the board, HCL Technologies.
''The merger of Axon's strong implementation capabilities with HCL's strong application and infrastructure management capabilities will help us deliver unique value on an end-to-end basis for the customers of HCL and Axon. The positive interactions between the HCL and Axon management teams since July '08, reinforces my belief that we will come together and create significant incremental value for both our customers and employees,'' said Axon, Ram Krishna, corporate vice president - Enterprise Application Services, said
HCL, which has identified eight focus areas for growth, including enterprise application services, sees Axon as a strategic fit. HCL is also following a selective acquisition policy identifying targets on the basis of its long-term strategic growth objectives.
Axon provides process consultancy services to large organisations that have chosen SAP as their strategic enterprise platform. It has a diversified customer base across the United Kingdom, North America, and Asia that is complementary to HCL's own customer base. It has approximately 2,000 employees, who bring in-depth industry expertise and best practices to address the challenges faced by organisations in today's dynamic environment.
For the year ended 31 December 2007, Axon reported profit before taxation of £29.5 million on revenues of £204.5 million.