Zenith Computers is planning to sell its computer manufacturing business to focus on its software business.
Zenith will demerge the PC business into a separate entity and sell the controlling stake to a strategic investor. RP Infosystems, which markets Chirag branded PCs, is said to be interested in the business.
Zenith and RP Infosystems have recently signed a non-disclosure agreement for the due diligence to proceed. RP Infosystem plans to appoint PWC for valuing the operations and advising on the deal. Zenith has valued its PC business at around Rs 160 crore.
Zenith Chairman, Raj Kumar Saraf has denied the deal, while RP Infosystems declined to comment.
Saraf family holds 54.37% stake in Zenith Computers. Zenith has appointed Singhi Advisors for advising on the deal.
Transaction Reference: ET
Zenith has a plant in Goa, which is part of the deal along with the brand. Zenith currently employs more than 630 people and the plant has a capacity for two lakh units.
HCL is the largest domestic PC brand while market shares of Zenith, Wipro and Chirag tend to vary. With this deal, RP Infosystems will become the number two domestic player with around 6% market share. The deal will also help RP Infosystem to tap into massive distribution and corporate client base built by Zenith in the West.
KVEZAR VIEW
| Date | Transaction | Type | Buyer | Size ($mn) |
| 08/07/10 |
Zenith Computers PC business - RP Infosystems |
M&A |
RP Infosystems Private Limted |
20.00 |
| Date | Type | Buyer | Target | Size ($mn) | State |
| 06/02/12 |
M&A |
Agni Property Services Private Limited |
Looking For |
- |
Planned |
| 02/02/12 |
M&A |
Persistent Systems Limited |
Location business |
- |
Completed |
| 31/01/12 |
Private Equity |
Tiger Global Management LLC |
Flipkart Online Services Private Limited |
150.00 |
Completed |
| 31/01/12 |
Venture Capital |
Mumbai Angels |
eDreams Edusoft Private Limited |
1.01 |
Completed |
Company |
| Name | Promoters | Office | Competitor | Website |
| Zenith Computers Limited |
Zenith Technologies Private Limited
Rajkumar Saraf & Group |
Zenith House, 29 MIDC, Central Road, Andheri (E), Mumbai–400093. Maharashtra, India. |
HCL Infosystems Limited |
www.zenith-india.com |
 |
Pricewaterhouse Coopers |
| |
Singhi Advisors |
