Axon has told Infosys it needs to increase the £400m offer it made for the firm or risk losing out to a rival bidder.
At the end of August Indian giant Infosys offered £407.1m to buy UK-based services outfit Axon Group, and Axon's directors recommended that shareholders accept the offer. But yesterday they changed their minds and told shareholders to instead vote for a rival offer from HCL Technologies which values Axon at £441m.
When Axon first received the offer from HCL it went into a 60-hour freeze period, as per its agreement with Infosys, during which the board could not change its recommendation. That period is now over.
"Axon and HCL have enjoyed a long-standing relationship," said Axon.
"The Board is pleased that HCL has recognised the quality of the Axon business and has announced its intention to make an offer. The HCL Offer values Axon's existing issued and to be issued (fully diluted) share capital at approximately £441m. The value of the HCL Offer is at a premium of 8.3 per cent to the value of the Infosys Offer."
A spokeswoman for Infosys said the company is in a quiet period ahead of its quarterly results on 10 October. It had previously urged Axon shareholders to wait until then before making a decision. ®