PES look to exit ACT as work-from-home boosts value

Hindustan Times (Chandigarh) - - Comment - Anirudh Laskar and Swaraj Singh Dhan­jal

PRI­VATE EQ­UITY FIRMS ARE EYEING AN EN­TER­PRISE VALUE OF AROUND $1.4 BIL­LION

MUMBAI: The own­ers of Atria Con­ver­gence Tech­nolo­gies Ltd (ACT) are in talks to sell a con­trol­ling stake in In­dia’s largest non-telco in­ter­net ser­vice provider amid a surge in de­mand for home in­ter­net ser­vices, two peo­ple aware of the de­vel­op­ment said.

Pri­vate eq­uity firms True North and TA As­so­ciates, which own more than 90% in the com­pany, are eyeing an en­ter­prise value of around $1.4 bil­lion, the peo­ple said on con­di­tion of anonymity. ACT had last raised $500 mil­lion from True North and TA As­so­ciates in 2015.

The plan is pri­mar­ily aimed at pro­vid­ing a prof­itable exit to the two pri­vate eq­uity in­vestors by cap­i­tal­iz­ing on the in­ter­net boom spurred by the work-fromhome econ­omy, one of the two peo­ple said.

“The dis­cus­sions are at an early stage. They are in the process of ap­point­ing an in­vest­ment bank to man­age the sale and are in talks with a few for­eign in­vest­ment banks for this. They will be look­ing at tel­cos that want to add to their wired broad­band ser­vices and for­eign PE funds for the stake sale,” the per­son added.

Global in­vestors have shown in­creased in­ter­est in In­dia’s fast­grow­ing in­ter­net ser­vices business, as cus­tomers con­sume more data at home as they work re­motely. The move by many house­holds to switch from ba­sic ca­ble TV ser­vices to in­ter­net­based ser­vices such as Net­flix, Ama­zon Prime Video and Dis­ney Hot­star is also fu­elling de­mand for broad­band in­ter­net.

On 29 July, Mint re­ported that sov­er­eign fund Qatar In­vest­ment

Author­ity is in ad­vanced talks with Reliance In­dus­tries Ltd to in­vest around $1.5 bil­lion in an in­fra­struc­ture in­vest­ment trust that holds the unit Reliance Jio In­fo­comm Ltd’s fi­bre-op­tic as­sets.

“This is the right op­por­tu­nity to pro­vide an exit to the pri­vate eq­uity play­ers that backed ACT Fiber­net for long,” said the first per­son.

Emails sent to ACT Fiber­net, True North and TA As­so­ciates re­mained unan­swered.

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