Electra Private Equity PLC (“Electra”) is pleased to announce that its subsidiary, Electra Partners Mauritius Limited, has agreed to sell its 23% interest in Zensar Technologies Limited (“Zensar”), the listed Indian IT services business, to a company backed by funds advised by Apax Partners, the private equity firm.
On completion of the transaction, Electra will receive proceeds of approximately £84 million (based on current exchange rates). Inclusive of dividends and proceeds from the sale of shares, this will generate a return of 19x on original cost over the 18 years of the investment; an IRR of 18%. This will represent an uplift of £12.4 million, or 18%, on the valuation of Zensar at 31 March 2015, implying an increase in diluted NAV per share of 31 pence.
Headquartered in Pune, India, Zensar is a leading IT services company and provides services to leading global clients in the Manufacturing, Retail and Hi-Tech verticals. Zensar has end-to-end capabilities in Oracle implementation and maintenance and is the industry leader in e-commerce solutions. The company employs over 8,000 people at 29 locations around the globe.
Electra originally invested US$9 million in 1997 in the equity of an unquoted subsidiary of a Mumbai-listed manufacturer of computer hardware. In 2001 the listed parent closed down its operations and the unlisted subsidiary performed a reverse merger and was then renamed Zensar Technologies. This resulted in Electra owning shares in the listed entity. Electra Partners Mauritius Limited has been represented on the Board of Zensar since 1997, and by John Levack, Portfolio Manager, since 2003.
Hugh Mumford, Managing Partner of Electra Partners, the Manager of Electra Private Equity PLC, said:
“Zensar has been an excellent investment for Electra’s shareholders having generated a 19x return.
“In 1997, when we first invested in Zensar, the company was uniquely positioned in the “software as a service” market with strong growth potential having established effective customer relationships and a good reputation. Since the original investment, the company has grown considerably supported by an acquisition strategy and a strong focus on innovation embracing new technologies. Today Zensar is an award-winning, global business and a technology partner of choice for leading organisations.”
This continues a very busy period for Electra. In the financial year to 30 September 2015, Electra’s portfolio activity included the disposals of JOC Group and Breakbulk from AXIO, as well as Nuaire; the bolt-on acquisitions to Allflex Corporation, AXIO, Davies Group, Elian¹, PINE Unit Trust and The Original Bowling Company¹ and the proposed merger and refinancing of Park Resorts. Earlier this week AXIO Data Group completed the sale of its Asian healthcare information business, MIMS, for $250 million.
Electra Partners Mauritius Limited is a subsidiary of Electra Private Equity PLC. Electra Partners refers to Electra Partners LLP acting on behalf of its client Electra Private Equity PLC.
¹ Transaction subject to approval.
For further information please contact:
Andrew Honnor and Matthieu Roussellier, Greenbrook Communications +44 (0)20 7952 2000
Andrew Kenny and Nicholas Board, Electra Partners +44 (0)20 7306 3932