Tata Sons arm to acquire controlling stake in Tejas Network for around Rs 1,890 crore
Telecom and network firm Tejas Networks on Thursday said a unit of Tata Sons will acquire a controlling stake in it for about Rs 1,890 crore in a multi-step deal. The company said in a statement that the company has entered into definitive agreements with Pantone Finvest, a subsidiary of Tata Sons (Tata Group’s holding firm).
As part of the agreement, the company will make a preferential allotment of 1.94 crore equity shares to Pantone at a price of Rs 258 per share for an aggregate amount of Rs 500 crore.
There will also be a further preferential allotment of 3.68 crore warrants, each entitled to subscribe to one equity share, at an exercise price of Rs 258 per equity share totaling Rs 950 crore. The statement said that warrants may be exercised by Pantone “in one or more installments during the period beginning from the date of allotment of warrants up to the end of 11 months from the date of allotment of warrants”.
In addition, there will also be a preferential allotment of 1.55 crore warrants, each with the right to subscribe to one equity share, at a total exercise price of Rs 400 crore per equity share of Rs 258.
It may be exercised by Pantone in one or more phases during a period beginning from the expiry of 12 months from the date of allotment of the warrant until the expiry of 18 months from the date of allotment of the warrant.
Pantone will also acquire 13 lakh equity shares of Tejas Network from certain personnel in the management for an amount not exceeding Rs 258 per equity share, aggregating to Rs 34 crore, subject to such terms and conditions as may be mutually agreed between the parties. categorically agree. said the statement.
Thereafter, Pantone and some other Tata group companies will make an open offer for acquisition of 4.03 crore equity shares of Tejas Network representing 26 per cent of the emerging voting capital in accordance with SEBI takeover regulations, the company said.
Commenting on the development, V Balakrishnan, President, Tejas Network said, “This association provides us with the necessary financial resources, global connections and a strong ecosystem to innovate and grow our business.”
Saurabh Agarwal, Executive Director, Tata Sons, said that Tejas Networks is a leading telecom and network company with a strong DNA of research and development. “We look forward to working with Tejas Networks’ highly experienced management team and building a full stack of globally competitive wireline and wireless products.”
Sanjay Nayak, CEO and Managing Director, Tejas Networks said, “Associating with the Tata Group will accelerate the realization of this vision and the huge market opportunities available to us to make the company a financially sound global company backed by a trusted brand. be able to address.
Post-acquisition, Nayak will continue to be the Managing Director and Chief Executive Officer to lead the Tejas Network along with the existing management team in the next phase of growth, the statement said.
“The preferential allotment of equity shares and warrants has been approved by the Board of Directors of Tejas Networks and the transactions are subject to shareholders’ approval and other customary closing conditions and approvals,” Tejas Networks said.
Kotak Mahindra Capital Company is acting as the manager of the open offer and Khaitan & Co is acting as the legal advisor to the transaction.
Tejas Networks designs, develops and sells high-performance networking products to telecom service providers, Internet service providers, utilities, defense and government entities in more than 75 countries.
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