New Delhi
The Economic Times Mint The Times of India (Mumbai edition)
HCL, India's fifth-largest software firm, made a 441.1 mn pound ($797 mn) offer for Axon on Friday, bettering Infosys's bid of 407 mn pounds and triggering market talk it could set off more counterbids.
"We are not in a bidding war or anything like that," Sandeep Gupta, HCL's corporate vice president for finance, said by telephone, adding the offer was made on the value it saw in Axon. "Based on data we have today, we have evaluated the value.
What data comes in we will evaluate it further," he said. Infosys, India's second-largest software firm with $1.8 bn in cash at end-June, has said it is considering its position in light of the HCL announcement.
HCL has said it plans to fund the acquisition through a 400 million pound loan from Standard Chartered Bank and from cash in hand. Gupta said if at all HCL had to raise its bid, it could dip into cash reserves of about $550 mn or take another loan.
"We have a solid partner with us who is Standard Chartered. If the situation comes like that (a higher offer) and we find taking a loan is more lucrative for us, I'm sure they will support us," he said.
Export-driven Indian software firms are looking to reduce their dependence on the wobbly U.S. market, which account for more than half the sector's revenue. UK-based Axon helps businesses implement software products from German's SAP AG, a segment seen as having a strong business potential.
The market leader in Britain, it gets nearly two-thirds of its revenues from outside the United States. Shares in HCL were trading up 1.9 percent at 199.50 rupees at 0907 GMT, after falling 8 percent on Monday on the counterbid. Infosys was up 1.3 percent at 1,410 rupees, rebounding from a 3.9 percent slide the previous day.
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