iGate to acquire part of Patni

iGate has bought around 63 percent of Patni Computer Systems.

The US company has splashed a huge $1.22 billion on India’s sixth largest IT firms.

Phaneesh Murthy, CEO at iGate,said that under the agreement iGate will buy 45.6 percent of the shares from the three Patni founders – Narendra Patni, Gajendra Patni and Ashok Patni –  along with a 17.4 per cent share of private equity firm General Atlantic.

The $1.22 billion sale will also include a mandatory 20 percent open offer to be made to the public shareholders of Patni.

The deal looks as though it will go through in the first half of 2011, following approvals by regulation officials.

However, not everyone is convinced about the buyout, claiming that the price should have been more.

“It’s not a price one would be gung-ho about, for sure,” Tejas Doshi, head of research at Sushil Finance in Mumbai told the Economic Times.

Patni provides technology outsourcing services to industries such as insurance, telecoms, utilities and retail. Its clients include General Electric Co , Hitachi and Procter and Gamble.