Lodestone Exploration Limited soon to become – Lodestone ...
Infosys acquires lodestone holding ag
-
Upload
st-francis-institute-of-management-research -
Category
Business
-
view
255 -
download
5
description
Transcript of Infosys acquires lodestone holding ag
Passion for Excellence. Commitment to Delivery.
Acquisition of Lodestone
Holding AG by Infosys
Limited
– By
Bhuvan Ranade (09)
Cletus Rodrigues (13)
Mayuresh Gavankar (26)
Ashutosh Dive (08)
Sagar Dhake (41)
Flow of Presentation
What is Acquisition?
About Infosys Limited
About Lodestone Holding
Objectives behind the acquisition
Conditions under the acquisition
Acquisition Process
Benefits to the Infosys
Financial Statements
Ratios
Conclusion
Bibliography
Infosys Limited
An Indian MNC provides consulting,
technology, engineering and outsourcing
services
Co-ounded by N. R. Narayana Murthy,
Nandan Nilekani, N. S. Raghavan, S.
Gopalakrishnan, S. D. Shibulal, K.
Dinesh and Ashok Arora
19th most innovative companies in the
world as per Forbes
Ranked 1st for its Corporate Governance
by IRGR
Earlier acquisitions
Portland in 2011
McAmish in 2009
Expert Info in 2003
IQ Financial in 2002
Lodestone Holding AG
• Management consulting & IT consulting
company having head office in Zurich
• Founded in 2005 by Ronald Hafner,
Jürgen Bauer and Peter Odman
• Offers advice to international
corporations on devising innovative
business operating models, optimizing
processes and implementing new
technologies leveraging SAP
What is Acquisition?
• A corporate action in which a company buys most, if
not all, of the target company's ownership stakes in
order to assume control of the target firm.
• Acquisitions are often made as part of a company's
growth strategy whereby it is more beneficial to take
over an existing firm's operations and niche compared
to expanding on its own.
Objectives behind the Acquisition• To enhance Infosys' global presence, particularly in
Continental Europe and
Emerging markets like Latin America and Asia Pacific
• Excess cash balance
• It’s a step closer to its goal of becoming a software-and-services
giant, providing clients with higher value services and consulting
• To compete with the competitors
• Lodestone has been growing at 18 per cent CAGR
Conditions under the acquisition
• Infosys to pay an aggregate
enterprise value of Swiss francs
330 Million in cash
• Lodestone will bring over 850
employees to Infosys
• Lodestone will also add more
than 200 clients
• Infosys put the bid for acquisition on 10th September & the
process got completed on 22nd October, 2012
• Lodestone Holding AG acquired by Infosys for Rs.1,925 crore
(approx. $345 million)
• The transaction is going to be completed in cash
• Infosys paid the two-third amount, i.e. Rs.1,187 immediately in
cash and the balance will be paid after 3 years
• At present, consultancy businesses contribute 31 per cent of
Infosys’ revenues
Acquisition Process
• Lodestone brings 850 employees which 750 are front line delivery
personnel
• A profitable and strategic SAP customer base
• Six Sigma standards and SAP, ASAP improved the quality of
implementation outcomes
• Post-acquisition, the consulting and package implementation revenues of
Infosys are expected to be more than $1 billion
• Deal will bolster Infosys' presence in Europe, Middle East and Africa
• IDEA Methodology of Lodestone has helped Infosys for its betterment
Benefits to Infosys
Financial Statements
Some Important RatiosRatios Infosys Ltd
before
acquisition
Lodestone
Holding
AG
Infosys Ltd
after
acquisition
Profitability Ratios
1. Return on Equity = NPAT
Net Worth 26.59% 65.28% 24.82%
2. Return on Capital Employed = EBIT
T.C.E. 30.50% 29.96% 27.61%
3. EPS = NPAT – Pref. Dividend
No. of Equity shares Rs.145.83
A – Rs.3350
B –
Rs.29400
Rs.165.01
100
100
Continued…Ratios Infosys Ltd
before
acquisition
Lodestone
Holding
AG
Infosys Ltd
after
acquisition
4. Gross Profit Ratio = Gross Profit
Net Sales 95.76% 98.59% 94.46%
5. Net Profit Ratio = Net Profit
Net Sales 24.70% 88.42% 23.37%
6. Operating Ratio = COGS + Operating Expenses
Net Sales 66.93% 1.84% 70.28%
7. Operating Profit Ratio = Net Operating Profit
Net Sales 25.49% 94.62% 21.36%
100
100
100
100
Continued…
Ratios Infosys Ltd
before
acquisition
Lodestone
Holding
AG
Infosys Ltd
after
acquisition
Turnover Ratios
1. Fixed Assets Turnover Ratio = Net Sales
Average Fixed Assets 5.79 times 1.94 times 5.6 times
2. Capital Turnover Ratio = Net Sales
Average Capital Employed 0.96 times 0.34 times 0.95 times
Continued…Ratios Infosys
Ltd before
acquisition
Lodeston
e Holding
AG
Infosys
Ltd after
acquisiti
on
Liquidity Ratios
1. Current Ratio = Current Assets
Current Liabilities 4.38 times 1.51 times 4.36 times
2. Quick Ratio = Current Assets – Inventories – Prepaid Exps
Current Liabs – Bank O/d – Advance Income 4.28 times 1.51 times 4.27 times
3. Proprietary Ratio = Proprietors’ Funds
Total Assets 81.69% 45.77% 82.01%100
Bibliography
http://articles.economictimes.indiatimes.com/2012-09-10/news/33737321_1_infosys-gains-shashi-bhushan-lodestone
http://www.infosys.com/newsroom/features/Pages/infosys-to-acquire-lodestone-consultancy.aspx
http://en.wikipedia.org/wiki/Lodestone_Management_Consultants
http://www.thehindubusinessline.com/industry-and-economy/info-tech/infosys-completes-acquisition-of-lodestone/article4022689.ece
http://en.wikipedia.org/wiki/Infosys
http://www.infosys.com/newsroom/press-releases/Pages/corporate-governance-practices.aspx
http://www.lodestonemc.com/our_firm/our_milestones/