HCL Technologies shares erase early gains; close 1% lower

HCL Technologies shares on Monday erased early gains and closed 1 per cent lower due to profit-booking.

In early trade, it had jumped nearly 5 per cent after the company said it will acquire Australian IT solutions firm DWS, a move that will help the Indian company strengthen its position in the Australia and New Zealand markets.

Shares of the company, which rose by 4.75 per cent to Rs 849.70 -- 52-week high -- during the day on the BSE, later fell prey to profit-taking and closed at Rs 802.30, lower by 1.08 per cent.

On the NSE, it closed lower by 0.98 per cent at Rs 802.65 after gaining 4.84 per cent to Rs 849.90 -- its one-year high -- during the day.

In a regulatory filing, HCL Technologies said the total equity value pay-out will be 158.2 million Australian dollars (about Rs 850.33 crore) after considering a total number of shares at 131.83 million on a fully-diluted basis.

The shareholders of DWS will also get a dividend of 0.03 Australian dollars per share which was declared by the company in its recent announcement of annual corporate earnings for FY20 (June-end), it added.

"The acquisition of DWS will strongly enhance HCL's contribution to digital initiatives in Australia and New Zealand while strengthening HCL's client portfolio across key industries," HCL said in a statement.

The filing said acquisition will be done by a process of scheme of arrangement to be approved by the court(s) in Australia, and the deal will also be subject to the approvals of Australia's Foreign Investment Review Board, Australian Competition Commission and New Zealand's Overseas Investment Office.