Tata Consultancy Services, Accenture and Oracle are in race to acquire around 90% stake in IT services provider Elitecore Technologies from global private equity fund Carlyle.
The fund that invested Rs 50 crore in the company eight years ago is expected to make more than nine time returns with the company now being valued at Rs 500 crore, three people with knowledge of the deal said.
In 2007, through its Carlyle Asia Growth Capital Partners, the fund had invested $10.3 million for a 33% stake in the company. It then invested $3 million to hike its stake in the company.
Subsequently in 2012, the network separate entity while the remaining businesses of the group was housed under the Cyberoam Technologies. Last year, Carlyle sold their 80% stake in Cyberoan to UK-based Sophos Group for Rs 500 crore. “The fund is expecting similar valuations for the network security business under Elitecore,” a banker with knowledge of the deal said.
“Leading IT players including Accenture, Oracle and TCS are in talks with the fund,” said another person involved in the transaction. Emailed query to spokespersons of Accenture and Oracle did not elicit response while spokesperson of TCS declined comment on market speculations.
Elitecore is promoted by US-based Hemal Patel and Benjamin Casado both technocrats. Attempts to reach the spokesperson of Carlyle and Elitecore over phone went unanswered.
Founded in 1999, Elitecore is an IT company is a provider of integrated policy, charging and revenue management. Most of its clients are in sectors such as telecom, hospitality and enterprises in more than 40 countries such as South East Asia, Saarc, Middle-East, Europe and Latin America.
The company is growing its profits at more than 53% compounded annually while its revenues are growing at more than 150. The company has its R&D and global support management centre in India. For Carlyle Growth, this would be another blockbuster exit after it made around 8 times returns on Cyberoam and three fold returns on exiting their investment in Tirumala Milk Products last year for Rs 1750 crore.
“Through these three exits, the entire growth fund has been returned. Rest is all a profit,” a consultant said on condition of anonymity. Its other investments include South Indian Bank, Edelweiss Financial Services, India Infoline, Visen Industries and Star Health and Allied Insurance.
