HCL Infosystems, an information technology (IT) hardware and services company, is selling its 100% subsidiary HCL Infinet to Tikona Digital Networks. HCL Infinet is an enterprise telecom service provider, with revenues of Rs 77 crore in the year ended June 2010.
Today, Axon Global’s shares will stop trading on the London Stock Exchange, marking a smooth ending to a takeover, which at one time saw HCL Technologies and Infosys Technologies pitted against each other. Though the logic of the deal and its benefits for HCL has been dealt with earlier, the ease with which HCL outbid Infosys is puzzling.
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HCL Technologies, as was rumoured, made its move to acquire Axon Global, spoiling Infosys’ party mood. The Delhi-based IT company has launched a counter-bid for Axon Global, which will make Axon shareholders happy, but also ups the acquisition cost for Infosys. HCL’s initial bid of 650 pence a share, through its UK-subsidiary HCL EAS, is just an invitation to start a bidding war. With just an 8.3% premium to Infy’s offer price, Infosys will most certainly make a counter-bid.