New Delhi: Private equity firm Blackstone today said it will buy out HP Enterprise's stake in Mphasis for up to Rs 7,071 crore (USD 1.1 billion), marking the largest IT deal for the US-based firm in India.
Hewlett Packard Enterprise (HPE) currently owns 60.5 percent of BSE and NSE-listed Mphasis.
"Blackstone will pay a purchase price of Rs 430 per share to HPE... As per the Takeover Code in India, this transaction will trigger a mandatory open offer for a purchase of additional 26 percent shares of the company," Blackstone said in a statement.
Reacting to the news, the stock of Mphasis opened higher by 2.03 percent on BSE at Rs 475.90.
Based on the open offer subscription, the purchase price consideration will vary between Rs 5,466 crore and Rs 7,071 crore (USD 825 million - USD 1.1 billion), it added.
HPE and Blackstone have agreed on the terms of a Master Services Agreement (MSA) which HPE proposes to sign with Mphasis, post approval by Mphasis? Board of Directors and shareholders.
The duration of the MSA is five years with three automatic renewals of two years each.
"Under the MSA, HPE has proposed to commit a minimum revenue amount escalating year over year and totalling USD 990 million over the next five years. Also, Mphasis will be included in HPE's Preferred Provider Program opening up significant additional revenue opportunities," it said.
Mphasis' last 12 months revenue as of December 31, was about USD 904 million and net profit of USD 104 million.