Companies of all sizes need to ensure their digital capabilities are up to par, especially given the shift to more remote operations. Virtusa Corporation is one of the companies helping Global 2000 enterprises with their
Just this week, Virtusa announced that it had been named a Visionary in the Gartner Magic Quadrant for IT Services for Communications Service Providers, worldwide. Last week, the company also hit an important stock market milestone, improving its Relative Strength Rating to 91, up from 70 the previous day.
Now the company has announced that it has entered into a definitive merger agreement to be acquired by Baring Private Equity Asia (BPEA), one of the largest and most established private alternative investment firms in Asia, in an all-cash transaction valuing at around $2 billion. The deal is expected to be finalized in the first half of 2021.
“This transaction represents a strategic evolution for Virtusa and a unique opportunity to take our business to new heights at a time of accelerating digital adoption,” said Kris Canekeratne, Chairman and CEO of Virtusa, in a statement. “With a strong partner in BPEA, we will solidify our position at the forefront of digital transformation for years to come.”
Following the acquisition, Virtusa sent a letter to its shareholders detailing its Three Pillar Strategic Plan. The document covered the company’s process to maximize value for shareholders through the transaction with BPEA, the merits of its 2015 Polaris acquisition, and its argument that investor New Mountain Capital’s analysis of the company and request for board member replacement are unfounded.
The deal has not been without additional challenges. Bragar Eagel & Squire, P.C., a stockholder rights law firm, has launched an investigation into whether Virtusa’s board members breached their fiduciary duties or violated the federal securities laws in connection with the pending acquisition. As a result, they are encouraging investors to contact the firm.
Nevertheless, Canekeratne maintains that, “the benefits of this transaction extend to all Virtusa stakeholders, including our shareholders, who will receive immediate and substantial cash value.”
