IT services firm 3i Infotech on Monday said that the company’s software product business has been acquired by private equity firm Apax Partner for a consideration of about Rs 1,000 crore.
The deal values the software business higher than the market capitalisation of the entire company (3i Infotech) which stands at around Rs 908 crore.
According to the joint statement issued by 3i Infotech and Apax partner, the software products business will be acquired by a newly formed company named Azentio Software, wholly-owned by the Apax Funds. The transaction, subject to shareholder approval and relevant regulatory approvals, is expected to close in early 2021.
According to reports, 3i Infotech’s software product business used to generate $60 million in annual revenue. After carving out the business and selling it off, 3i Infotech would continue to focus on its services business. “Today’s announcement is transformative and value accretive for all stakeholders of 3i Infotech,” said Padmanabhan Iyer, Managing Director & Global CEO, 3i Infotech. “I foresee a very exciting future for both the IT services and the software products business. Both businesses will have the resources to capitalise on market opportunities and build long term value for employees, customers and shareholders.”
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Shashank Singh, Partner and Head of the India office at Apax Partners, said, “Increasing technology spend on core software systems across the BFSI industry and ERP space is driving rapid growth in the enterprise software market in the region. The newly formed company, Azentio, has a strong portfolio of feature rich products that run the core operations for customers. We are excited to unlock Azentio’s potential and help transform the business into a true regional leader in the software space.”
The software business focusses on core BFSI with clients in Middle East, South East Asia and India growing at a 6-8% CAGR. It has a core insurance platform called Premia, a core lending platform for banks and NBFCs called Castle, an anti-money laundering application called AM Lock, a core fund management application called M-Fund and ERP software application called Orion among others.
Started in 1993, 3i Infotech has over 5500 employees across 12 countries with customers located in more than 50 countries across four continents.
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