New Delhi: Essar Group said on Monday that it had entered into a definitive agreement to sell its business process outsourcing (BPO) unit Aegis Ltd to private equity (PE) firm Capital Square Partners.
“This transaction is in line with our strategy of incubating, building and operating world-class businesses, and being open to monetizing them at a premium value when the market conditions are favourable,” Uday Gujadhar, director at AGC Holdings Ltd Mauritius, a holding company of Aegis, said in a statement.
Capital Square Partners has deep domain expertise and understanding of South-East Asia to ensure that the company continues to grow, Gujadhar added.
Financial details of the transaction were not disclosed. Net proceeds of the sale will be used to retire Essar Group’s debt, the company said. The transaction is expected to close in the current quarter, subject to receipt of regulatory approvals and other customary closing conditions Financial.
Aegis has clients in multiple sectors such as telecom, technology, media, banking, financial services and insurance, travel and logistics, retail and e-commerce.
The company employs 40,000 people across 47 offices worldwide, offering services including lifecycle management, technology services, back-office services and social media analytics. Its annual revenue is around $400 million.
Essar’s advisors in the transaction included Axis Capital as financial advisor, and Platinum Partners and Sidley Austin as legal advisors. Shearman & Sterling and Shardul Amarchand Mangaldas acted as legal advisors for Capital Square Partners.
Capital Square Partners has in the past invested in technology services and BPO sectors, including its acquisition of Minacs Ltd in early 2014; Minacs was subsequently acquired by Synnex Corp. in 2016 and merged with Cocentrix.
The Aegis sale comes close on the heels of Essar Group selling Essar Oil Ltd in a $13 billion transaction with Rosneft PJSC, Russia’s biggest listed oil producer, and a consortium of Trafigura and United Capital Partners. The deal marked the biggest foreign direct investment in India till date.
The transaction was a fallout of debt-related stress in the Essar Group, which at the time of Essar Oil’s sale in October had debt of Rs.1.3 trillion, according to an estimate by Kotak Institutional Equities.