- Tanla Solutions (NSE:TANLA, BSE:532790) today signed a definitive share purchase agreement to acquire 100% of Karix Mobile (formerly known as mGage India) and its wholly owned subsidiary Unicel from GSO Capital Partners, a Blackstone Company, at an enterprise value2 of 340 Crore.
- GSO will receive a cash payment of 112 Crore. This will be funded from Tanla’s internal accruals. Further GSO will be issued 125 Crore worth of Tanla stock at a price of 56.79 per Equity share. Tanla will take over a Debt of 103 Crore.
- On a fully diluted basis, GSO will own approximately 14.6% in Tanla, Promoters 30.6%, Employees 5.6% and Public shareholding 49.2% on completion of the acquisition. GSO will have an observer seat on Tanla’s board.
- The Promoters have to subscribe to 7.9 Mn number of shares to retain their pre-acquisition shareholding of 30.6%. The agreed price for subscription to shares is 40, subject to SEBI (ICDR) regulations and approval of shareholders.
- GSO is entitled to pre-emptive rights3 in future allotment of capital, to enable GSO to avoid dilution.
- Karix Mobile an 18-year-old global brand, has offices in four major Indian cities with over 1500 enterprise clients globally, and a revenue of 540.24 Crore in FY2018.
- With combined revenues5 of 1170 Crore in FY2018, Tanla will emerge as a leading cloud communications company in India providing formidable digital transformation strategies to its enterprise clients.
- Tanla expects cost synergies6 of approximately 15 Crore, over the next six quarters of operations.
- This acquisition is expected to close by October 2018 and is subject to approval from Tanla’s Shareholders and regulators, if any.