Investcorp Gulf to invest $98-mn in Redington

Chennai: Investcorp Gulf Opportunity Fund Company, a global private equity group, will invest $98 million for a 36 per cent stake in Redington’s Middle East and African (MEA) business. This values Redington’s MEA business at $272 million, according to a communication provided by Redington to the Bombay Stock Exchange.

The Chennai-based end-to-end supply chain solutions provider for global brands in the IT and non-IT verticals expects the transaction will be completed by the middle of November. “The funding will help us grow organically in the Middle East and also make acquisitions in geographies such as Turkey and South Africa where we do not have a presence,” Mr R. Srinivasan, Managing Director, Redington, said.

“Despite tough market conditions, we were able to raise funds,” he said. Investcorp’s past and present portfolio includes over 80 corporate investments totalling $29 billion in acquisition value, says information on the company’s Web site.

Redington has two direct overseas subsidiaries namely Redington Gulf FZE (for Middle East and Africa operations) and Redington Distribution Pte Ltd (for Singapore and South Asia operations). In West Asia, Redington’s subsidiary continued to be the top player in the IT products distribution space for the third successive year, according to Redington’s 2007-08 annual report.

Redington Gulf contributes nearly 50 per cent of the company’s overall revenues and profit, Mr Srinivasan said.