Aegis StarTek Merger on Horizon

Published By : 14 May 2018 | Published By : QYRESEARCH

The merger of Aegis, and Indian business process outsourcing firm, of which Flipkart and Paytm are the key customers, with the US-listed StarTek is on the horizon. This merger has been designed so that if it closes before July 23, it will to evade conferring of warrants issued to Amazon, the American enterprise told the US Securities and Exchange Commission. The Capital Square Partners announced their plan to merge Aegis with StarTek in March 2018, which will result in the PE firm taking a dominant stake of 55% in the combined company.

The e-commerce giant, Amazon has held warrants, which it could vest for shares, permitting it to take a bigger stake in StarTek after it gave US$600 mn in revenue or if there was a modification in the control at the BPO firm. This may cause concerns for some of the existing ecommerce clients of Aegis, who consider Amazon their main rival. Chad Carlson the CEO of StarTek, told that the company will provide details regarding the Amazon warrant in its proxy filings with the securities regulator in the U.S.

StarTek stated in the SEC that the Aegis Transactions as structured so that it forms an Excluded Transaction. However, if Amazon does not allow to extend the date, forcing the Aegis Transactions to close after July 23, 2018 and then the Aegis Transaction will form a Change of Control Transaction and completion of the Aegis Transactions will lead to the accelerated vesting of the Amazon Warrant.

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