MACR Project

Background
iGate entered into purchase agreement with Patni (2.5 times the size of

iGate) on January 2011 and announced completion of acquisition in May for $1.22 billion (5465.46 crores then)
Acquisition the biggest involving an Indian company beating the

previous record of Oracle acquiring i-flex for 4090 crores

iGate chief executive Phaneesh Murty designated as CEO and MD of

combined entity
Combined entity referred to as iGate Patni with adequate

representation from both sides, but both continue to be listed separately

Acquisition Details
Price paid by iGate was Rs 503.5 amounting to $921 million to acquire 63%

stake Open offer to buy additional 20% stake for $301 million also got fully subscribed at the same price

Companies are willing to give you deals worth about 7.5-10% of your revenue, Murthy said. That means they can now go for deals in the $75-100 million range (on an annual basis).

Parameter (as on Dec. 2010) Sales growth % EBIT margin %

iGate 15% 30%

Patni 10% 32%

Depreciation as % of Sales Tax rate on EBIT

Terminal growth rate Unlevered Beta D/E ratio standalone WACC Exchange Rate

4% 15%
3% 1.19 10.5% 1$ = Rs. 46

9% 19%
5% 1.7 (0f ADR listed in NYSE) 15.7%

iGate Firm Value = Rs. 5372.92 Cr. Value per share = $ 20.5

Patni Firm Value = Rs. 6795.55 Cr. Value per share = Rs. 507 Premium to CMP = 10.2%

Patni (APV) Firm Value = Rs. 6922.63 Cr. Cash Flow from Tax Shield = Rs. 172.46 Cr. EV/EBITDA = 9.0x

Deal Tech Mahindra Ltd. Purchased 31% stake in Satyam Computer Services Ltd. EDS Corp. acquired Mphasis BFL

Year 2009

Valuation $1.13 billion

EV/EBITDA

2006

Rs. 1748 Cr.

16.1

Oracle Corp acquired iflex Solutions Ltd.

2005

Rs. 4090 Cr.

19.6

Opportunities to play in larger deals, more verticals Cross-sell key solutions to a broader client base Efficiencies in operations and delivery services Economies of scale from consolidation of shared services

 Employee Base of 26,000 and a client base of 360 Two $100 million dollar clients, two $50 million-dollar clients and Thirty-six $5 milliondollar clients Top 5 accounts contributing to 38% and top ten accounts contributing to 49% of revenues 10 Delivery centers across India, Mexico and Australia, and over 50 offices in 20 countries