American International Group (AIG), Carlyle and General Atlantic Partners are in the final race to pick 10-15% stake in Bangalore-based Sobha Renaissance Information Technology (SRIT) for around $50 million. The deal could value SRIT, the tech arm of Sobha Developers Group, at $400-450 million, a source said.
It is believed that AIG is the front-runner in the process managed by Edelweiss, while multi-stage venture capital giant Oak Investments Partners is seen as another possible player in the fray. “Out of the 11 interested suitors, the list has been narrowed down to three, or possibly four. The deal could be unveiled by this month end,” the source added.
SRIT, with estimated current revenue of around $60 million, is an emerging player in digitized healthcare, telecom and enterprise solutions. The company is seen attracting 7-8 times valuation on revenues going by the details emerging on the impending transaction.
The promoter $2-billion Sobha Group owns almost 100% of SRIT currently. When contacted, SRIT confirmed Edelweiss was running a mandate for picking up a partner, but declined to identify the suitors in the fray.
Sources said others like Sequoia Capital and Standard Chartered Private Equity were also in the picture initially, but dropped out subsequently. It is believed that the company is likely to opt for a partner who could help it break into the US market. AIG, with significant interests in healthcare and telecom space, could end up being the winner given SRIT’s growing focus on these two verticals.
“SRIT’s current presence is in the far east, south east Asia, Middle East and a few countries in Europe. The focus is to foray into US market, where healthcare alone is estimated at $1.5 trillion. The company has some exciting solutions in the healthcare space,” sources added.
SRIT, providers of outsourced IT business services and software products, was incorporated in 1999. It was ranked amongst the top 50 fastest-growing technology companies by Deloitte Touche Tohmatsu Asia Pacific Region in 2006. In the last 18 months, SRIT effected a slew of small to mid-sized acquisitions. This included Munich-based Billing Components AG in the telecom business support systems (BSS) space and the buyout of Objective Systems Integrators, a player in telecom operations support systems (OSS), from Agilent Technologies.
Recently, it acquired SimpleRM, value-added CRM assets, from TriVium Systems Inc and led buyout of two software products Infotrack and Zipdrive in the retail and after sales segment from Tranquil Solutions.
SRIT, which is tracking an IPO by the year 2011, has operation and customer proximity centres across South East Asia, Middle East, Europe, Africa and North America.
Source: Economic Times