HCL is expected to acquire 38% stake held by Geometric’s principal shareholders — Godrej family and CEO Manu Parpia — giving them control of the Mumbai-headquartered company, people directly familiar with the matter said.
The deal-making was in final stages and a formal announcement would come shortly. Ace investor Rakesh Jhunjhunwala and his wife, who together own 19%, are likely to sell or pare their holdings in separate open market transactions with the acquirer.
India’s fourth largest software exporter HCL Technologies is expected to merge Geometric with itself. JM Financial is advising Geometric on the transaction.
Geometric started as part of the Godrej Group in 1984 and was spun off into an independent company a decade later.
The company’s portfolio covers global engineering services, product lifecycle management (PLM) solutions, embedded systems solutions and digital technology.
It reported $181.4 million in revenue for the 2014-15 financial year and employs 4,800 people across 13 global delivery locations in the US, France, Germany, Romania and China, apart from India.
TOIlast year had reported on Geometric starting a sale process, attracting the interest of several strategic bidders including HCL. The Geometric acquisition is expected to tap synergies in engineering services and PLM solutions.
HCL is betting big on engineering services as its growth engine which has crossed over $1billion in revenue already. Geometric counts Dassault Systemes and Chrysler as some of its top customers.
HCL Technologies said it does not want to comment. Geometric stated it would not comment on market rumours and speculation. Godrej holds little over 31% stake through Godrej & Boyce Manufacturing Company and Godrej Investments, while Manu Parpia and his family owns just under 7%, listing them as promoters.
Geometric is aggressively expanding engineering services and PLM software in North America and Japan.
