Warburg wins QuEST deal with $75m bid

The private equity firm edged out rivals Bain, KKR and ChrysCapital for a minority stake in the Bangalore-based outsourcer.

Warburg Pincus will invest $75 million for a minority stake in engineering services and processes outsourcer QuEST Global Services, the company said in a statement.

The global firm had edged out rivals Bain Capital, Kohlberg Kravis Roberts and ChrysCapital with a reported $60 million bid for QuEST in October. QuEST had been looking to raise $60 million by October, a spokeswoman for the Bangalore-based company told sister news site PEI Asia in a previous interview.

It is unclear what accounts for the $15 million price difference as Warburg Pincus did not comment by press time.

Ajit Prabhu, chief executive officer of QuEST Global Services, said the fresh capital would go to enhancing the company’s business and “to expand growing needs of our customers”.

QuEST designs and manufactures engineering software for clients such as GE, Rolls Royce and Airbus. The Carlyle Group, investing from the $170 million Carlyle Asia Venture Partners II, had backed the company with $6 million in May 2003. Carlyle has since fully exited its investment, although details of the transaction have not been made public. 

The QuEST deal is just one of several bidding wars for Indian assets to have taken place this year. In October, it was reported that four private equity suitors, TPG Capital, The Carlyle Group, Kohlberg Kravis Roberts and Bain Capital, were vying to acquire a minority stake in Hero Honda, India’s largest motorcycle maker. 

The Financial Times most recently reported that Carlyle and TPG will help the Munjal family, which controls India’s Hero, to buy back Honda’s 26 percent stake for about $1.4 billion.