Indian American Couple Sells IT Firm Syntel to French Company Atos for $3.4 Billion
Indian-origin couple Bharat Desai and Neerja Sethi have agreed to sell their United States-based technology services provider Syntel to French firm Atos for $3.4 billion.
Indian-origin couple Bharat Desai and Neerja Sethi have agreed to sell their United States-based technology services provider Syntel Inc. to French firm Atos for $3.4 billion. Syntel, founded in 1980, employs 23,000 engineers in 30 countries, with over 80 percent of its staff based in India.
The deal “is a very exciting development for Syntel. The Syntel board is committed to maximizing shareholder value and believes that the agreement with Atos achieves that objective and delivers a win-win proposition to our customers and employees,” Desai, the co-founder and co-chairman of Syntel, said in a statement.
Atos will buy Syntel for $41 per share, a premium of 4.78 percent to Syntel’s closing price of $39.13 on July 20.
The cash deal will boost the presence of Atos in North America.
“This transaction is a major step in the strategy of Atos to reach a global scale,” Atos said in a statement.
“In particular, the highly complementary portfolio, customer base, and geographic footprint of the combination between Atos and Syntel will significantly enhance our presence in North America,” chief executive Thierry Breton said.
— Atos (@Atos) July 23, 2018
Syntel earned $924 million in revenues in 2017, of which 89 percent was in North America.
In response to a query on the future of the workforce at Syntel, a spokesperson for Atos told Reuters: “We look forward to welcoming the 23,000 Syntel employees, inclusive of 18,000 staff based in India. We believe there is a tremendous cultural fit between the two companies. During the integration of Syntel, one of our priorities will be to retain most talented employees. Based on the track record we have with our previous acquisitions, we are confident to succeed.”
Desai and Sethi, who together held 57 percent stake in the company, stand to make nearly $2 billion from the deal. The former employees of Tata Consultancy Services (TCS) started Syntel with $2,000 at their apartment in Troy, Michigan. The company earned $30,000 in its first year.
Sethi, the 63-year-old vice president of Syntel, has a net worth of $1 billion. Last month, she figured at the 21st spot in Forbes’ list of America’s most successful self-made women entrepreneurs and executives as measured by their net worths.
She holds an undergraduate degree and MBA from the Delhi University, and a masters degree from the Oakland University. Desai, who was born in Kenya and grew up in Mombasa and Ahmedabad, is alumnus of IIT-Bombay and earned an MBA from the University of Michigan.