Zensar divests non-core business to Lorhan IT services
News | 23 Jan 2019
Digital solutions firm Zensar said that it has entered into an agreement with Lorhan IT Services, a wholly owned subsidiary of First Tek, Inc. to divest its Australia, Middle-East and India-based businesses.
This is in line with the company’s decision to focus on, and invest in the core markets of USA, Europe, and South Africa. These three geographies comprise more than 98% of its total revenue as of December 31st, 2018.
In the quarterly results announced yesterday, the ‘rest of the world’ business had slumped by almost 40%, which CEO Sandeep Kishore said was the result of a conscious decision to focus on core geographies.
Under the terms of the transaction, identified assets, liabilities, employees, and client contracts relevant to these businesses will be transferred to Lorhan. The Australia and Middle East businesses will be transferred by way of a share sale, while the India-based business will be transferred as a slump sale.
Sandeep Kishore, Chief Executive Officer and Managing Director, Zensar Technologies said, “Zensar is focused on strengthening its key verticals of hi-tech manufacturing, retail, and insurance in our core markets of US, Europe and South Africa. In the First-Tek group, we found the right partner for our Australia, Middle-East and India businesses. Given their focus to grow these regions we believe these businesses are aligned better for growth with First-Tek.”
Kumar Bhavanasi, President and Chief Executive Officer, First-Tek said, “We are a fast-growing company, and were looking to expand our operations in Australia, Middle-East and India. Zensar’ s operational base and the skills on offer complements our growth strategy. We look forward to adding more value to current customers and giving exciting career opportunities to the people coming on board.”
Ajit Deshmukh, Managing Director and Head of Investment Banking, Equirus Capital, who advised Zensar on the transaction said, “This divestment by Zensar of its non-core business will help them focus on the overall growth strategy.”