New Delhi, April 22 -- Mphasis Ltd, a technology service provider backed by private equity firm Blackstone, has bought 100% stake in Canadian AI firm Theory and Practice Business Intelligence Inc. (TAP).
The Bengaluru-based company, which is listed on the domestic bourses, will pay CAD 10 million ($7.3 million or Rs 68.5 crore) in cash upfront for the acquisition of TAP and its relevant affiliates.
The deal agreement involves an additional payment if certain management-based multi-year milestones are achieved, which may take the deal value to CAD 20 million ($14.6 million or around Rs 137 crore), according to its filing with the exchange.
The deal will help Mphasis grow its teams in AI, data science and behavioral economics, and position itself as "AI-led, platform enabled, products and solutions service provider", it said in a release. It will also help it expand its consumer packaged goods (CPG) portfolio.
TAP, a technology company headquartered in Vancouver, Canada,, has built Continuum AI, a decision intelligence platform, which combines AI with behavioral economics to improve business decision-making and understanding buyer behavior. The platform serves enterprises in the financial services, retail and CPG sectors.
"TAP's Continuum AI will be a key catalyst for NeoIP (Mphasis' AI platform), introducing a critical decision intelligence layer that can drive measurable economic outcomes for enterprises," said Nitin Rakesh, chief executive officer and managing director, Mphasis. "Built on advanced AI and deep behavioral economics capabilities, this combination allows us to move beyond task automation, towards systems that can reason over business objectives, constraints and domain context, to deliver these outcomes."
As a part of the deal, Rogayeh Tabrizi, founder and chief executive of TAP, will join Mphasis' leadership team as Executive Vice President - CPG and Head of Decision AI.
Currently, Blackstone owns more than 30% stake in Mphasis. It had acquired a 60.5% stake in Mphasis in 2016 from Hewlett Packard Enterprise for Rs 5,466 crore ($827 million), then its largest deal in India. The PE firm lowered its stake in 2017 and 2018, but increased its holdings in 2020 to take advantage of a weak stock price.
In April 2021, Blackstone teamed up with Abu Dhabi Investment Authority (ADIA), UC Investments, and Singapore's GIC in a deal worth up to $2.8-billion (Rs 21,000 crore) to roll over its bet in Mphasis after dropping a plan to sell the company. Later that year, it stitched a plan to roll over its investment from a legacy fund to a newer investment vehicle while roping in some limited partners (LPs) as co-investors.
Published by HT Digital Content Services with permission from VC Circle.