Persistent Systems launches $452M share sale to refinance Nagarro loan
What's the deal? Persistent SystemsDealroom has a profile for this one. Try Dealroom → has launched a qualified institutional placement (QIP) to raise up to US$579.2M, setting a floor price of US$75.4 per share. The Indian software firm's board-appointed committee approved the issue's opening on October 21, with JP Morgan India, IIFL Capital Services, and HSBC Securities as book-running lead managers.
Why now? The placement is central to Persistent's plan to refinance the €1.4 billion, 18-month bridge loan it used to fund the takeover of German firm NagarroDealroom has a profile for this one. Try Dealroom →, announced in June 2026 for about $1.45 billion. Shareholders approved the equity raise through a special resolution on October 5, within a combined debt-and-equity financing cap of $1.25 billion.
What's the endgame? Persistent has secured roughly 94% of Nagarro and expects the acquisition to close in the fourth quarter of 2026 or the first quarter of 2027, pending remaining approvals. The deal is aimed at building a larger AI-focused digital engineering group.
By the numbers: The QIP follows Persistent's 26th consecutive quarter of revenue growth. September-quarter revenue rose 30.3% year-on-year to US$633.4M, or 20% in dollar terms to $487.6 million. Reported net profit fell to US$47.8M, however, after a US$25.1M exceptional expense tied to the Nagarro acquisition. Shares slid 5% after the results.
What could go wrong? The raise could cut Persistent's reliance on debt but will dilute existing shareholders, making the US$75.4 floor price and final issue size key for investors. The company may offer a discount of up to 5% on the floor, subject to shareholder approval.
The signal: The placement shows how acquisitive Indian IT firms are turning to public equity markets to replace short-term debt and fund consolidation. For Persistent, converting a bridge loan into longer-term capital is a step toward absorbing its largest acquisition while acquisition costs weigh on near-term profit.
Read more: cnbctv18.com
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