Polaris Financial Tech surges on spin-off plans
Mar 19 2014 , Mumbai
Polaris will create a new company called Intellect Design Arena Ltd that will house its global universal banking, risk and treasury management, global transaction banking, and insurance businesses.
Polaris will retain its services businesses.
Shareholders of Polaris will receive one share of Intellect for each share held while Intellect shareholders will also be offered a special option to exchange shares for 90-day non-convertible debt with a 7.75 percent coupon.
"We believe that investment cycle for Product business is very different from that of services business, hence, spin-off as a separate entity could unlock the value for the investors," brokerage Prabhudas Lilladher said in a note.
"Moreover, we believe the current structure is simpler for the management, if they decide to exit completely (sell-out) from either of the business," the brokerage says.