Deal to catapult the Indian company into top tier of solution integrators space

Mumbai, India: Essar Group, a multinational conglomerate and a leading player in the sectors of steel, oil and gas, power, communications, shipping ports and logistics, construction and minerals, and Avaya, a global leader in enterprise communications systems, software and services, today said that they have entered into a definitive agreement under which Essar Group would acquire Avaya’s entire 59.13 per cent stake in BSE / NSE listed AGC Networks for USD ($) equivalent of Rs206.19 crore, or Rs245 a share, subject to customary Indian regulatory requirements and completion of the open offer.

The acquisition would be done through Essar Services Holdings (ESHL). Essar Capital Finance (ECF) along with ESHL, Person in Acting in Concert with ECF, would come out with the mandatory open offer for an additional 20 per cent stake at a price determined as per the formula specified in the SEBI takeover regulation. ECF will make a mandatory public announcement on Monday, May 31, 2010. Assuming all shares are tendered in the open offer, the total size of the open offer will be approximately Rs78 crore.

 AGC Networks, earlier known as Avaya GlobalConnect, is a converged communication solution provider focused on the India and Australia market. The company employs approximately 500 people. The current management is expected to continue and spearhead the business post-closing.

Edelweiss Capital is the sole advisor to the transaction and is the manager to the open offer.

Speaking on the occasion, Aparup Sengupta, managing director, and global CEO, Aegis, said, “Essar in a short span has become a key player in the SI space and would benefit immensely from the depth and width of expertise AGC Networks has. We have a definitive plan to grow this business as we aim for bigger chunks of customer spends.”

SK Jha, president, SI business, Essar, said, “AGC Networks is a leading player in the contact centre, unified communications, and networking space as a solutions integrator with a roster of marquee clients and cutting-edge products. It provides a great synergy with our systems integration business. With this acquisition, Essar will gain deep expertise in the ‘enable’ block of experience management that Essar embarked upon through its worldwide expansion drive. Now customers will have the ability to have unified communication and experience management under one roof. We look forward to the successful completion of the transaction and welcome the AGC Networks staff, partners and customers and look forward to a very rewarding relationship with them.”

 

About Essar Group
The Essar Group is a multinational conglomerate and a leading player in the sectors of steel, oil and gas, power, communications, shipping ports and logistics, construction and minerals. With operations in more than 20 countries across five continents, the Group employs 60,000 people, with revenues of  $15 billion.

 

About ESHL
ESHL is the company having investments in the Aegis group, which is a world-leading outsourcing services partner for more than 135 clients and with over two decades of leadership in total customer lifecycle management. The company has more than 39,000 employees across 42 locations, with a presence in ten countries, serving verticals such as BFSI, telecom, healthcare, travel and hospitality, consumer goods, retail and technology. The company specializes in tailor-made solutions that cover the entire spectrum of customer and business experiences—across business processing, technology, and shared services—and offers customized engagement models to further facilitate the ease of doing business. Aegis is wholly owned by the Essar Group—a $15 billion conglomerate. For more information, please visit www.aegisglobal.com.”