There was a buzz around software product firm Subex on Monday after the firm said that the company MD and CEO Subash Menon would make an ?important corporate announcement? on Tuesday. Subex closed on the BSE at R46.90, up 4.22%.
The firm, which sells fraud management software product to telcos among other products, has been in the middle of stake sale rumours since April this year, but top executives in the firm told FE that the company is not looking at being acquired at the moment.
Market watchers and analysts, however, said that Subex is trying to raise funds and a minority stake sale could be on the cards.
In August last year, Rayed Holding & Finance, the investment arm of a telco, made a strategic investment in Subex. The telco picked up 7% stake in the company. Subex had then said that it planned to raise capital to pay off debt that has been bothering the firm for long. The firm?s bottom line has been facing pressure on the repayment of debt due to FCCB (foreign currency convertible bond). FCCBs worth $94 million are outstanding.
In 2009, Subex restrcutured outstanding FCCBs ? the firm had $180 million to be converted by March 2012. However, the firm had little cash and since it had to pay back $245 million, it approached bondholders to discount on the face value of the bond. Around $141 million was subsequently written down to $98.7 million.