Tata Sons Arm To Acquire 43.3% Stake In Tejas Networks For Nearly Rs 1,850 Crores
- ByStartupStory | July 29, 2021
Tata Sons subsidiary, Panatone Finvest Limited has signed a pact to pick 43.3% stake in Bengaluru-based telecom equipment firm, Tejas Networks, for Rs. 1,850 crores. Tejas Networks designs, develops and sells high-performance networking products to telecommunications service providers, internet service providers, utilities, defence and government entities in over 75 countries. As per a regulatory filing on Thursday, the company would utilize the proceeds raised from the preferential allotment to invest organically and inorganically in the research and development, sales and marketing, people, infrastructure and to enhance its manufacturing and operational capabilities.
As part of the agreement, the company will make a preferential allotment of 1.94 crore equity shares at a price per equity share of Rs 258 per share aggregating to Rs 500 crore to Panatone. There will also be another preferential allotment of 3.68 crore warrants, each carrying a right to subscribe to one equity share at an exercise price of Rs 258 per equity share aggregating to Rs 950 crore. This may be exercised by Panatone in ‘one or more tranches during the period commencing from the date of allotment of the warrants until expiry of 11 months from the date of allotment of the warrants’, the statement added. Further, a preferential allotment of 1.55 crore warrants, each carrying a right to subscribe to one equity share at an exercise price of Rs 258 per equity share aggregating to Rs 400 crore, will also be made.
Panatone will also acquire up to 13 lakh equity shares of the Tejas Networks from certain personnel in management, at a price not exceeding Rs 258 per equity share aggregating to Rs 34 crore, subject to such terms and conditions as mutually agreed between the parties, the statement said. Subsequently, Panatone and other certain companies of the Tata group will make an open offer to acquire up to 4.03 crore equity shares of Tejas Networks representing 26 per cent of the emerging voting capital in accordance with SEBI Takeover Regulations, the company said. “Tejas Networks was started with a vision of creating a top-tier global telecom equipment company from India. The association with Tata group will accelerate the realisation of this vision and enable us to address the large market opportunity available to us to build a financially strong global company,” said Sanjay Nayak, CEO and MD, Tejas Networks. Commenting on the development, Saurabh Agrawal, Executive Director, Tata Sons said “We look forward to working with the management team of Tejas Networks and creating a full stack of wireline and wireless products.” Mr. Nayak will continue as the Managing Director and Chief Executive Officer of Tejas Networks along with the existing management team.
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