Coforge Ltd. on Friday announced the acquisition of US-based artificial intelligence company Encora for an enterprise value of $2.35 billion. The purchase will be financed by share swap and an equity sale of institutional investors.
An equity value of $1.89 billion will be paid in the form of equity shares through preferential allotment worth Rs 17,032 crore by Coforge. This will result in shareholders of Encora holding approximately 20% of the company’s shares, according to a stock exchange filing.
The shares will issued at Rs 1,815 apiece, which is at a premium of 8.5% of the previous close.
A bridge loan or Qualified Institutional Placement (QIP) of upto $550 million will be floated to retire the term loan in Encora.
The transaction is an all-stock deal where the sellers, including Advent International and Warburg Pincus, will roll over into Coforge and not take any consideration as cash.
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