iGate To Close Patni Deal In A Week

Software company iGate said it will close its $1.2 billion acquisition of Patni Computer Systems within a week. “The open offer process for Patni has been completed and we got an oversubscription. We have gone with the mandatory 20 percent,” Chief Executive Phaneesh Murthy told Reuters. Murthy, who expects the acquisition to close on May 12, said iGate will report consolidated quarterly results from the April-June quarter.

“It looks like the Patni integration process is tracking pretty well,” Kaufman Bros analyst Sachin Jain said. Getting the uncertainty regarding the deal’s closure out of the way seems to have boosted investor sentiment, he said. CEO Murthy said he is aiming for a gross margin of 40-41 percent for the combined company within two years. IGate, which competes with the likes of Infosys Technologies, Cognizant Technologies Services Corp and Genpact Ltd, expects second-quarter sales for the combined company to be flat on a sequential basis.

Fremont, California-based IGate, backed by private-equity firm Apax Partners, in January acquired a majority stake in India-based Patni for $1.2 billion in one of the largest deals in India’s technology sector.