Mphasis Limited Announces Strategic Investments to Fuel Growth and Subsidiary Support

Mphasis Limited, a leading IT solutions provider, outlined a strategic financial plan during a Board of Directors meeting on April 25, 2024. These strategic investments aim to enhance operational efficiency and support the continued growth of the company’s subsidiaries.

Capital Infusion for European Subsidiary

• Investment Amount: Mphasis Limited will invest up to US$80 million in the equity share capital of Mphasis Europe BV, a wholly-owned subsidiary based in Europe. Mphasis also proposes to issue a corporate guarantee to secure an uncommitted line of credit to be availed, in one or more tranches, by Mphasis Europe BV up to US$ 150 Million.
• Objective: This capital injection will empower Mphasis Europe BV to repay existing borrowings, potentially improving its financial flexibility and streamlining operations.
• Timeline: The investment is expected to be completed by the end of June 2024.

Supporting US Subsidiary Growth

• Investment Amount: Mphasis Limited has committed to investing up to US$70 million in the common stock of Mphasis Corporation, its wholly-owned US subsidiary.
• Objective: This investment will provide Mphasis Corporation with the necessary resources for various purposes, including potential debt repayment. Increased financial stability can fuel further growth and strategic initiatives within the US market.
• Timeline: The investment in Mphasis Corporation is scheduled to be completed by the end of December 2024.

Strategic Implications

By strategically allocating capital to its subsidiaries, Mphasis Limited demonstrates a commitment to long-term growth and operational optimisation. These investments aim to:

• Strengthen Financial Health: Debt reduction within the subsidiaries can improve overall financial stability and create a more robust foundation for future expansion.
• Enhanced Operational Flexibility: Access to additional capital can empower the subsidiaries to pursue strategic opportunities and optimise operational efficiency.
• Global Growth Strategy: Supporting its subsidiaries in key markets like Europe and the US underscores Mphasis Limited’s commitment to a strong global presence and continued success in the IT solutions landscape.

About Mphasis Limited

Mphasis Limited is one of the leading global Information Technology (IT) solutions providers, specialising in cloud and cognitive services. It applies next-generation technology to help enterprises transform businesses globally. On April 26, 2024, the Mphasis shares opened at ₹2,237.70 and touched the day high of ₹2,370.70 at 09:35 AM.

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