Hexaware’s delisting buyback may give good gains

Mumbai: Investors could make a quick buck from Hexaware Technologies’ delisting. Analysts said a 20 per cent gain is likely in three months if the shares are bought now and tendered in the buyback for delisting.The stock is currently trading at Rs 325, while its parent Barings Private Equity has offered 285 per share to take the company private.“Previous delisting proposals in India give a cue about the hefty premiums demanded — up to 100 per cent — by minority shareholders and the indicative offer price at 285 appears significantly lower than what they would be willing to accept,” said Karan Uppal, analyst, PhillipCapital. “We expect the final delisting price to be significantly above the offer price — most likely in the Rs 350-450 range.”Currently, Barings PE holds 62.4 per cent stake in Hexaware. In August 2018, the firm sold about 8 per cent stake at a floor price of Rs 447.5 apiece.76635877In 2012, iGate delisted Patni Computer Systems at Rs 520 per share, a 46 per cent premium to the floor price. Similarly, in 2013, Oracle Financial increased its delisting offer for i-flex Solutions by 42 per cent. It still could not get the minimum response from shareholders.“The offer price is definitely on the lower side as the promoter sold about 8 per cent stake two years back at 57 per cent to the announced offer price,” said Arjun Yash Mahajan, head - institutional business, Reliance Securities. “Considering the Covid-19 environment, Baring PE may not sweeten the deal to that level, but a premium of 30-40 per cent cannot be ruled out. Investors could hold on for some more time,” he said.

from Economic Times https://ift.tt/2Z9sOL3