Sterlite Technologies, a provider of transmission solutions has entered into a definitive agreement for the acquisition of Elitecore Technologies, a global telecom software product company for an overall enterprise value of approximately Rs 1.80 billion in an all-cash deal.
Elitecore is a leading provider of operations support services, business support services and is majority owned by First Carlyle Ventures Mauritius, whose affiliate is advised by The Carlyle Group.
The company said, "This acquisition widens Sterlite's telecom portfolio of offerings to its global customers, in addition to its current offerings comprising optical products and allied system integration services. The company will now offer industry leading software solutions for operations support, business support and revenue management."
"This acquisition opens up access to a large multi-billion dollar market which, when combined with the existing large and expanding market for optical products globally, significantly enhances the overall growth opportunity for the company," it added.
The transaction is expected to be value accretive by FY17 and is expected to be closed shortly subject to completion of certain regulatory and statutory formalities. Upon completion of the transaction, Elitecore Technologies is proposed to be merged into Sterlite Technologies.
Sterlite was advised by Cyril Amarchand Mangaldas on legal matters, PwC on financial diligence, EY on taxation matters and KPMG on transaction structuring matters.
Pravin Agarwal, vice chairman, Sterlite Technologies, said, "The transaction follows our strategy to undertake attractive M&A opportunities in the entire telecom value chain. Elitecore has had an excellent performance record, with its management and employees having a wealth of experience and expertise in developing solutions for telecom companies. The acquisition is a lever for Sterlite to create new inflections in the telecom arena that are in line with Sterlite's long-term goals of being an integrated telecom solution provider."
Shares of the company gained Rs 1.3, or 1.61%, to trade at Rs 81.90. The total volume of shares traded was 85,843 at the BSE (9.44 a.m., Wednesday).
