Larsen & Toubro Limited to acquire 21% stake in E2E Networks Ltd

Larsen & Toubro Limited has entered into an Investment Agreement on November 5, 2024 for acquisition of upto 21% stake in E2E Networks Limited.

E2E Networks Limited ('E2E Networks'), founded in 2009, headquartered in Delhi and listed on NSE in 2018 is an Indian cloud company offering public cloud services to its customers.

E2E Networks specializes in providing CPU and GPU-based cloud computing platforms, to help its customers carry out large scale general and AI-workloads by leveraging its relationship with NVIDIA.

The acquisition is complementary for market approach in the fast-growing areas of AI and cloud services. Along with the acquisition, the Company also proposes to enter into a software license agreement, reseller agreement and colocation agreement with E2E Networks.

Pursuant to the acquisition, the Company will also have the right to nominate upto 2 (two) directors on the board of directors of E2E Networks and will also have certain rights and obligations in relation to transfer of equity shares of E2E Networks by Mr. Tarun Dua and Ms. Srishti Baweja (promoters of E2E Networks).

The Company proposes to acquire a total of 41,71,410 Equity Shares of E2E Networks (comprising of an aggregate 21% of the Capital) as set out below:

1. Investment via preferential allotment for 15% stake in E2E Networks, comprising of 29,79,579 Equity Shares of E2E Networks, for Rs. 1,079.27 Crore at Rs. 3,622.25/share determined as per SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018.

2. Investment via secondary acquisition of 6% stake, comprising of 11,91,831 Equity Shares in E2E Networks from the founder for Rs. 327.75 Crore at Rs. 2,750/share.

The Company will not acquire control in E2E Networks pursuant to the proposed acquisition and will be a minority shareholder with certain protective rights.

E2E Networks operates as an Infrastructure Cloud and AI/ML/GenAI Cloud Platform, offering GPU-as-a-Service solutions tailored for mid-sized enterprises, startups, research institutions like IITs and IIITs, and fintech firms across 10 countries. Serving over 3,000 active clients, E2E Networks is the first company in India to offer both NVIDIA H100 and H200 GPUs as service on their public cloud.

E2E Networks has formed strategic alliances with major OEMs, including NVIDIA, Intel, AMD, HPE, Microsoft, and Dell. Leveraging open-source technologies, E2E Networks has developed proprietary virtualization and cloud management software solutions (IP), creating scalable systems that support long-term customer needs.

Shares of Larsen & Toubro Limited was last trading in BSE at Rs. 3573.60 as compared to the previous close of Rs. 3626.30. The total number of shares traded during the day was 57838 in over 5573 trades.

The stock hit an intraday high of Rs. 3622.10 and intraday low of 3531.05. The net turnover during the day was Rs. 206279814.00.

Source : Equity Bulls

Keywords

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