Reuters Posted online: Wednesday, January 28, 2004 at 1224 hours IST Updated: Wednesday, January 28, 2004 at 1325 hours IST
Mumbai, January 28: Hewlett-Packard Co said on Tuesday that it will pay 850 rupees each for shares it does not already own in its Indian arm, Digital GlobalSoft Ltd, increasing the buyout price to 14 billion rupees ($308 million).
The offer was made by Hewlett-Packard Leiden B.V., a subsidiary of the US computer giant which currently holds a 50.6 per cent stake in the Indian company.
HP had announced in December its plan to buy out the remaining stake at an indicative price of 750 rupees and delist Digital from the stock exchanges.
However, India's stock market rules require the delisting price to be set through a book-building process -- which yielded the higher price.
In a public announcement posted on Tuesday on the National Stock Exchange's website, www.nseindia.com, bankers for the offer said they received the most bids for the shares at 850 rupees.
Digital shares jumped as much as six per cent to 843 rupees on the news, but pared gains to end at 829.45 rupees as investors were unwilling to wait the stipulated six months for the next opportunity to sell their shares to HP at the 850 rupee level.
Mumbai’s share index rose about three per cent.
HP, the world's No.2 computer maker after International Business Machines Corp, became the majority shareholder in Digital when it took over Compaq Computer Holding Ltd in May 2002.
