India's HCL Tech to buy Axon

Last Modified: 05 Oct 2008
Source: PA News

British consulting firm Axon Group PLC has agreed to accept a 441 million pound bid from India's HCL Technologies Ltd, rejecting an earlier offer by India's Infosys Technologies Ltd, company officials said.

HCL offered to buy Axon for 650 pence a share in cash on Sept. 26, an 8.3% premium to the 600 pence per share offer Infosys had made six days earlier.

The acquisition - the largest by an Indian IT company - comes at a time of difficulty for India's information technology sector, which depends heavily on US financial services firms that have been hit hard by the credit crisis.

"(T)he Board has withdrawn its recommendation of the Infosys Offer and intends unanimously to recommend the HCL Offer," Axon said in a statement.

HCL spokeswoman Meena Vaidyanathan said the Axon acquisition would enable the firm to offer cost-competitive, end-to-end services to clients.

"It will enhance our ability to participate in more transformational deals," she said.

HCL does business in 19 countries, with a strong manufacturing client base and a growing life sciences business. Last fiscal year, HCL relied on the US market for 57.4% of its business, but more than two-thirds of revenues came from nonfinancial services companies.

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