L&T In Talks To Buy Patni

Larsen & Toubro subsidiary - L&T Infotech is in talks to buy a majority stake in Patni Computer Systems Ltd as the founders - Narendra Patni and his brothers Gajendra and Ashok, plan to sell their stake. They hold 48.3% and General Atlantic LLC holds about 18% of the company.

Ambit Capital has been given the mandate to seek buyers and conduct a valuation of the company.

In 2007, talks for a similar sale had ended in a stalemate, as only Gajendra and Ashok were willing to part with their holdings. Narendra, who has been actively involved in running the business, was not. But this time, the deal is likely to go through as General Atlantic is looking to exit the company. It had invested $100 mn in Patni in September 2002.

Founded in 1978, Patni provides IT services and business solutions. Its services include application development, application maintenance and support, packaged software implementation, infrastructure management services, product engineering, business process outsourcing, and quality assurance services

Patni is currently the sixth largest IT firm in India, while L&T Infotech is currently in 11th place. If L&T Infotech acquires Patni, it would make the combined entity the fifth-largest software firm in India.

In December 2006, L&T Infotech acquired GDA Technologies - a privately held electronic design firm based in California, USA and all of its design centers in USA and India, for an undisclosed amount.

Patni has also approached Dell Inc, IBM, Fujitsu Ltd and Accenture for the deal.

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