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JSA advises Pl Industries Limited on making rule 2.7 offer announcement for acquiring Plant Health Care plc

JSA advised and assisted PI Industries Limited (“PI”) in making an offer announcement for the acquisition of Plant Health Care Plc (“PHC”), a UK incorporated company traded on AIM (i.e., a market operated by the London Stock Exchange, in terms of Rule 2.7 of the (UK) City Code) on Takeovers and Mergers (“2.7 Announcement”).

Pursuant to 2.7 Announcement, PI’s Dubai based subsidiary would acquire the entire issued share capital of PHC by means of a court-sanctioned scheme of arrangement (“Scheme”) under the provisions of the English law, including the City Code on Takeovers and Mergers and Part 26 of the (UK) Companies Act, 2006. The Proposed Acquisition will be consummated on the Scheme becoming effective, which requires, approval of PHC’s shareholders in majority and English courts.

While PI is one of the market leaders in the agricultural inputs industry with over seven decades of experience, PHC is known for its pioneering protein/peptide technology in the agricultural biologicals space. PHC has subsidiaries in the US, Brazil, and Mexico, and a robust R&D base in the US.

The acquisition will enable the PI to offer integrated agri-solutions across both chemicals and biologicals and provide PI with access to PHC’s advanced biological/peptide technology platforms in the Plant Immunity Inducers space, complementing PI’s existing portfolio of eight biological products and expanding its development and registration pipeline. The combination of PHC’s technologies with PI’s existing chemical products portfolio will enhance PI’s capabilities to  serve key agricultural markets globally.

Our Transaction Team Comprised Lead Partner – Manvinder Singh, Partner – Anant Mishra, Senior Associate – Parnik Saxena and Archi Roy, Associate – Adarsh Raj Singh and Sharique Uddin.

Coforge acquires majority stake in Cigniti

JSA represented Coforge Limited (“Coforge“) in its proposed acquisition of a majority stake of Cigniti Technologies Limited (“Cigniti“) for approximately USD 256 million. The transaction included Coforge making an open offer to the public shareholders of Cigniti in terms of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.

Coforge is listed on BSE and NSE and is a global enterprise information technology solutions and services company offering its clients comprehensive capabilities in product engineering services, intelligent automation services, data and integration services, cloud and infrastructure management services, software engineering services and business process management services.

Cigniti is listed on BSE and NSE and is engaged in the business of providing digital assurance and digital engineering services.

The deal also involved (a) the subsidiary of Coforge availing a committed line of financing on May 2, 2024, for an amount not exceeding USD 250 million by the Hongkong and Shanghai Banking Corporation, GIFT city branch; and (b) Coforge undertaking a fund raising exercise by way of a QIP to fund the acquisition.

Our Transaction Team Comprised Lead Partner – Anand Lakra, Principal Associate – Ami Shah, Senior Associate – Jinay Shah, Associates – Shreya Shinde, Diya Dave, Parth Mehta and, B M Biplab.

Our Banking and Finance Team Comprised Partner – Utsav Johri and Sucheta Bhattacharya and Associate – Suprabh Garg.

Our Data Protection Team Comprised Senior Associate – Saurabh Sinha, and Associate – Himanshu Kumar.

Our Employment Team Comprised Partner – Sonakshi Das.

Our Competition Team Comprised Partner – Vaibhav Choukse and Ela Bali, Principal Associate – Nripi Jolly and Senior Associate – Aditi Khanna and Associate – Faiz Siddiqui.

Our Indirect Tax Team Comprised Partner – Shareen Gupta, Principal Consultant – Ruchita Modi, and Associate – Tanay Vyas.

JSA advised Inflexor Technology Fund on its acquisition of a minority stake in GenAI startup, Ayna

Inflexor Technology Fund led a round of funding and acquired a minority stake in GenAI startup, Ayna.

The Bengaluru-based startup leverages its proprietary compound foundational models (CFMs) and diffusion models to provide ecommerce brands with studio-quality product photoshoots, and helps brands manage their product images by enabling them to specify precise requirements, change elements, and experiment with various styles.

Our Transaction Team Comprised Lead Partner – Siddharth Mody, Principal Associate – Prerana Chaudhari, and Senior Associate – Alister Sequeira.

JSA advised OIJIF II in its sale of a portion of its investment in Annapurna Finance Private Limited

JSA advised Oman India Joint Investment Fund II (as a seller) in selling a portion of its stake in Annapurna Finance Private Limited (“Annapurna”) to Piramal Alternatives and another buyer. Piramal Alternatives acquired shares of Annapurna from OIJIF II and other sellers, in total acquiring approximately 10% of the total share capital of Annapurna for cash consideration by way of purchase of equity shares of INR 300 Crores. Piramal also subscribed to debentures of INR 300 Crores issued by Annapurna.

Annapurna is one of India’s leading microfinance institutions headquartered in Odisha with assets under management in excess of $1.25 billion as on March 31, 2024.

The transaction was consummated after receipt of approval of the Competition Commission of India

Deal value: USD 75 million

Our Transaction Team Comprised Lead Partner – Archana Tewary, Partner – Nikhil Joseph.

Airo Digital Labs LLC Acquires Cloudaction LLC

JSA advised and assisted AiRo Digital Labs LLC (“AiRo”) in the acquisition of Cloudaction LLC (Oklahoma limited liability company) and its Indian affiliate Cloudaction Technology Services Private Limited (“Cloudaction”).

AiRo is an innovation-led transnational company headquartered in Chicago, United States of America. It operates in the artificial intelligence and robotics space, assisting clients in a vast array of sectors such as healthcare, life sciences, manufacturing, retail and banking and insurance. It has been recognized by Inc. 5000 and Forbes as a startup in transformative technology and AI-driven innovation.

Cloudaction specializes in the market-leading business applications and IT automation solutions driving enterprise digitalization.

Our Transaction Team Comprised Lead Partner – Shivpriya Nanda, Partner – Zain Pandit, Senior Associate – Twisha Shrivastava, Associate – Vibhu Choubey, Ananya Mathew, and Treya Gupta.

Jain Resource Recycling Private Limited acquires majority stake in UAE based Jain Ikon Global Venture (FZC)

Kedaara Capital Fund II LLP sells its 100% stake in Sunbeam Lightweighting Solutions Private Limited

JSA advised and assisted Jain Resource Recycling Private Limited (“JRR”), a company which has in-depth experience in metal recycling and manufacturing and has presence in almost 20 countries. JRR acquired majority stake in the UAE based Jain Ikon Global Venture (“Company”) from Ikon Square Limited. As part of the strategic partnership, the Company will operate a gold refining plant at UAE to process raw materials such as gold dore bar, gold powder and old jewellery to make gold bar of minimum 99.95% purity.

 The JSA transactions team was involved in the structuring the transaction, advising on the issues pertaining to overseas direct investment and consequent review, negotiations and finalizing of the documentation in relation to the transfer of shares from Ikon to JRR. The JSA tax team advised JRR on the tax and transfer pricing related issues.

Our Transaction Team Comprised Lead Partner – Trisheet Chatterjee, Partner – Sarvesh Kumar Saluja, and Associate – Neeral Jain.

Our Tax Team Comprised Partner – Kumarmanglam Vijay.

Acquisition on Corra Technology Inc by Publicis Group

JSA advised Corra Technology, Inc. (“Corra”) and its founders, a global commerce leader and systems integrator helping brands and organizations grow by evaluating, building, and optimizing their digital commerce ecosystems, on the India leg of Corra’s 100% acquisition by Sapient Corporation, a Publicis Group company (“Publicis Sapient”) which is a multinational marketing communications holding corporation.

 Corra was founded in 2002, and headquartered in New York with additional operating locations established in the U.S., the U.K. and India. Corra helps build faster and flexible digital storefronts for growing brands across retail, food and beverage, technology and electronics, health and wellness, and B2B industries.

 The acquisition of Corra will enhance Publicis Sapient’s current capabilities in commerce solutions, including Adobe Commerce and MACH Alliance composable commerce solutions. Additionally, Corra would provide specialized resources that cover several of Publicis Sapient’s capabilities, such as strategy, product, experience, engineering, and data and AI.

Our Transaction Team Comprised Lead Partner – Manvinder Singh, Partner – Anant Mishra, Senior Associate – Archi Roy and Parnik Saxena, Associate – Adarsh Raj Singh and Pragya Pandey.

JSA advised Ismartu India in the acquisition of its controlling stake by Dixon Technologies

JSA represented Ismartu India Private Limited (“Ismartu India”) and its shareholders Ismartu Singapore, Transsion Technology Ltd, and 5A advisors LLP in the sale of its controlling stake to Dixon Technologies (India) Limited. The transaction will take place in two tranches. In Tranche 1, Dixon will acquire a 50.01% stake for approximately INR 2.38 billion in an all-cash deal. Thereafter, in Tranche 2 Dixon will acquire additional stake ranging from 1.60% to 5.90% of Ismartu India on a fully diluted basis. The transaction is subject to the satisfactory completion of the conditions precedent and requires approval from the Competition Commission of India.

Ismartu India is the manufacturing unit of the mobile phone manufacturer Transsion Holdings, which is a leading player in the global mobile phone manufacturing industry, ranking among the top five smartphone makers and sellers globally. Ismartu India Private Limited is a dominant player in the electronics manufacturing segment in India, with a turnover of approximately INR 62.35 billion as of March 31st, 2023.

JSA provided end-to-end assistance to the client in the acquisition process, covering regulatory consultation, structuring, drafting, and negotiation of transaction documents.

Dixon Technologies was advised and assisted by Cyril Amarchand Mangaldas.

Our Transaction Team Comprised Partner – Kartik Jain, Senior Associate – Saumya Sahai, Associate – Anmol Mahajan and Company Secretary – Alisha Chawla.

Our Competition Law Team Comprised Partner – Vaibhav Choukse, and Ela Bali, and Associate – Faiz Siddiqui.

CPrime Inc., acquires Integrhythm Inc., and its subsidiary in India

JSA advised CPrime Inc., in its acquisition of Integrhythm Inc., (“Target“) and Integrhythm (India) Private Limited (“Indian Subsidiary“). CPrime Inc., is a trusted global consulting partner, backed by private equity firms such as Goldman Sachs Alternatives and Everstone Capital and provides enterprise-level strategic consulting and technical solutions. INRY is a ServiceNow Elite Partner renowned for its innovative solutions in HR workflow optimization and customer service management.  As part of the transaction, JSA carried out the legal due diligence of the Indian Subsidiary and assisted in the review, negotiation and finalisation of the definitive documentation.

Our Transaction Team Comprised Lead Partner – Archana Tewary, Senior Associate – Savio Tom, Associate – Ajith Kidambi and Company Secretary – Megha Kumari.

Warranty and Indemnity Insurance for M&A Transactions: Frequently Asked Questions

Continuing with our series on the importance of Warranty and Indemnity (W&I) Insurance Policies for M&A Transactions, Nandini Seth (Partner) and Dhruv Malhotra (Principal Associate) answer some of the frequently asked questions raised by clients while considering a W&I insurance backed deal.

 

Transcript

I am a potential acquirer looking to procure a buy-side W&I insurance policy. When should I start the process?

As a buyer, who is looking to procure a warranty and indemnity insurance policy for a transaction, it would be useful to speak to, and get in touch with an insurance broker as early as the commencement of the due diligence process.

 

I am a seller with a limited fund life and want to structure a NIL recourse exit. How should I approach this?

As sell side, it is advisable to bring up W&I insurance in the initial discussions. We have seen clients discuss W&I insurance (with limited recourse or NIL recourse) at the LOI/ term sheet stage itself.

 

While structuring a NIL recourse deal, is it possible for the insurer to consider the buy side draft of the acquisition agreement for providing insurance coverage? 

No, insurers insist on providing comments only on a negotiated acquisition agreement, particularly the representations and warranties schedule. Based on our experience, it is advisable that the parties negotiate the representations and warranties as if the deal is structured on an indemnity basis before submitting the transaction documents for the purposes of procuring insurance.

 

Does a corporate seller need to continue to exist throughout the duration of the W&I insurance policy?

W&I insurance makes for an excellent choice for funds with a limited fund life or which are winding up shortly. This is because the seller does not need to be in existence for the duration of the W&I insurance policy.

 

As a buyer, should there be any kind of rights against the seller in case of a NIL recourse deal backed by W&I insurance? 

Yes, please ensure that there is a subrogation right against the seller for fraud. Insurers typically require incorporation of this right in the transaction documents as well as in the insurance policy.

 

Can a buyer procure a W&I insurance policy after signing the transaction documents? 

Absolutely. An insurance policy can be procured after signing the transaction documents. However, do remember that in such a case, there will be coverage gaps for breaches discovered between the signing date and the policy inception date.

 

Can the payment of premium be delayed until the closing of the transaction?

Insurers typically provide a time period (after the inception of the policy) for paying the insurance premium. In fact, insurers understand these issues and have also accommodated upfront requests for refund of an identified percentage of premium for a W&I policy due to non-occurrence of closing.

 

What is the typical premium payable for procuring a W&I insurance policy?

While the premium payable generally ranges from 2.2% to 3.5% of the insurance limit, it can go as low as 1.5% or higher as well. The premium quoted by the insurers is specific to each transaction.

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