Essar to acquire Avaya stake in AGC Networks

The Essar Group and Avaya, a global leader in enterprise communications systems, software and services, on Sunday said they had entered into a definitive agreement under which the Essar Group would acquire Avaya's entire 59.13 per cent stake in BSE and NSE-listed AGC Networks (earlier Avaya Global Connect) for $44.5 million, or Rs.206.19 crore, at Rs.245 a share subject to customary Indian regulatory requirements and completion of the mandatory open offer.

The acquisition would be done through Essar Services Holdings Limited (ESHL) and Essar Capital Finance Private Limited (ECF). They will come out with the mandatory open offer for an additional 20 per cent stake in AGC Networks at a price determined as per the formula specified in the Securities and Exchange Board of India (SEBI) Takeover Regulations.

ECF will make a mandatory public announcement on Monday. Assuming all shares are tendered in the open offer, its total size will be about Rs.78 crore.

The open offer process is expected to take between three and five months to complete.

AGC Networks is a converged communication solution provider focused on the Indian and Australia markets. It employs around 500 people and the current management is expected to continue spearheading the business post-closing. Edelweiss Capital Limited is the sole advisor to the transaction and is the manager to the open offer.

‘Key player'

Aparup Sengupta, Managing Director and Global CEO, Aegis Limited, said: “Essar in a short span has become a key player in the systems integration [SI] space and would benefit immensely from the depth and width of expertise AGC Networks has. We have a definitive plan to grow this business as we aim for a bigger chunk of customer spends.”

AGC Networks is a leading player in the contact centre, unified communications, and networking space as a solutions integrator with a roster of marquee clients and cutting edge products.

S.K. Jha, president, SI Business, Essar, said: “It provides a great synergy with our systems integration business. With this acquisition, Essar will gain deep expertise in the ‘enable' block of experience management that Essar embarked upon through its worldwide expansion drive.”

The sale of its AGC Networks stake will enable Avaya to focus on two strategic imperatives — the development of the Avaya business in India and the growth and extension of its channel coverage model through Avaya's global channel programme, Avaya Connect.

AGC Networks remains a key channel partner of Avaya serving customers in the India market, one of the fastest growing enterprise communications markets in the world and in Australia.

“The AGC Networks relationship remains key to Avaya's success in India and Australia — both through the period of this transaction and beyond,” said Jangoo Dalal, Managing Director, Avaya India. “In India we work together to serve some of the country's leading organisations spanning multiple business sectors, and we look forward to continuing to work with AGC Networks as a trusted and well established business partner.”

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Printable version | Jun 13, 2021 12:29:27 PM |

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