iGate Corp. and U.S. private equity fund Apax Partners agreed to buy a 63 percent stake in Patni Computer from General Atlantic LLC and the founders of Patni computers in a deal valued at around $1.22 billion (Rs. 6,750 crore)..AZB & Partners advised Patni Computers and also the co-founder brothers. Patni and AZB have a long standing relationship and even have a legal process outsourcing company Bodhi Global. AZB was led by Partners Zia Mody, Essaji Vahanavati and Alka Nalavadi who advised the company and the selling brothers Ashok, Narendra and Gajendra Kumar Patni..WSJ reported that “As part of the agreement, iGate will offer 503.5 rupees ($11.08) a share for the 45.6 percent stake held by the founders–Ashok, Narendra, and Gajendra Patni–and the 17.4 percent held by General Atlantic worth a combined $921 million. That would trigger an open offer for 20 percent more in the company under Indian regulations. Including the $301 million it expects to spend on acquiring 20.6 percent more in Patni through the open offer if all shares are tendered, the deal value would stand at about $1.22 billion iGate said in a statement”..J. Sagar & Associates advised the Chairman & CEO of Patni Computers. Somasekhar Sundaresan led the team for JSA..Wadia Ghandy is understood to have advised the Board of Directors of Patni Computers. Partner Ashish Ahuja advised the 13 member Board of Directors..Khaitan & Co acted as the Indian legal advisors to iGate corporation with Partners Haigreve Khaitan and Rabindra Jhunjhunwala. A press release from Khaitan mentioned that this is the largest M&A transaction in the Indian IT industry and post the buy iGATE will be propelled into a billion-dollar company with 25,000 employees..Kirkland & Ellis advised private equity firm Apax Partners and iGate. Srinivas Kaushik, Partner advised iGate while Partners Frederick Tanne and Susan Zachman advised Apax Partners. AmLaw mentioned that Partners Jay Ptashek, Neel Sachdev, Joshua Korff, and Michael Kim advised iGate on its debt financing. StanChart, Deutsche Bank are reported to have agreed to lend $ 600-700 million while Apax Partners will fund part deal via debt convertible to equity..S & R along with London office of Paul, Weiss, Rifkind, Wharton & Garrison advised the selling shareholder General Atlantic. General Atlantic held nearly 17 percent in Patni Computers. Sandip Bhagat led the S & R team while the London office Partners Mark Bergman and David Lakhdhir represented Paul Weiss..iGate hired Jefferies as its financial adviser, Apax was advised by Standard Chartered Plc. Credit Suisse Group AG and Ambit Capital Pvt. advised the Patni family..Shearman & Sterling is representing Jefferies Finance and RBC Capital Markets. Finance Partner Michael S. Baker is leading the Shearman & Sterling team. The Shearman team also included Partners Robert Freedman, Maura E. O’Sullivan and Capital Markets Partner Jason Lehner..Mukund Srinath, Vice President- Legal of iGate was not available for a comment at the time of going to press..This deal which had to be signed last Sunday was called off due to the lack of clarity about tax liability. According to media reports, the controversy over Vodafone’s $10 billion buyout of Hutchison’s stake in telecom joint venture Hutch-Essar in 2007 seems to have given both parties reason enough to re-evaluate the modalities of the deal, as Vodafone is being asked to pay Rs. 12,297 crore as tax for the 2007 acquisition. It is apprehended that the deal with US-based iGate and private equity firm Apax Partners, might also run into similar tax issues, as both are overseas entities.
