BT is selling its 9.1 percent stake in Tech Mahindra in a deal expected to raise about $183 million and see the British telecom operator exit an Indian IT services group it co-founded more than two decades ago.
Tech Mahindra shares are being sold at a floor price of Rs 855, according to a term sheet seen by Reuters, a discount of 2.8 percent from Tuesday's Rs 879.50 closing price. The stock is up about 53 percent this year.
BT, which set up technology outsourcing services provider Tech Mahindra with India's Mahindra & Mahindra n 1986 and was its second largest shareholder in the past, has been gradually paring its stake in the Indian joint venture.
It sold 14.1 percent of Tech Mahindra stake for about $250 million in August.
Britain's biggest fixed-line telecom company is also one of the major clients of Tech Mahindra, which provides technology services to global telecoms operators, and its exit is likely to cloud the outlook for future contracts from BT.
JPMorgan and Credit Suisse are advising BT on the share sale, and the shares will change hands on the Indian stock exchanges via block deals today, the term sheet showed.
BT had to rely on deep cost cuts to maintain its full-year earnings outlook after an adverse regulatory ruling and weak European corporate demand sent revenues down 9 percent in the second quarter.
BT's stake sale in Tech Mahindra adds to a busy week for equity offerings in India, with more than $2 billion worth of share deals likely to be closed by Friday, after a lacklustre first half of the year.
The government's sale of a $1.1 billion stake in miner NMDC is set for Wednesday, while leading telecoms tower operator Bharti Infratel is selling shares to raise up to $830 million in the country's biggest IPO in two years.
First Published On : Dec 12, 2012 09:19 IST