Persistent Systems Announces Mega Acquisition of Nagarro SE, Details AGM and Dividend Approval Plans

Persistent Systems Announces Mega Acquisition of Nagarro SE, Details AGM and Dividend Approval Plans​

Persistent Systems Ltd has announced significant developments ahead of its 36th Annual General Meeting (AGM), including the proposed acquisition of German digital engineering firm Nagarro SE. The company confirmed that the AGM is scheduled for Monday, August 3, 2026, and provided details regarding dividend proposals, director reappointments, and material related party transactions concerning the merger.

The Board reviewed several strategic alternatives before concluding that acquiring Nagarro represented the strongest path to accelerate Persistent’s European expansion and strengthen its position in the AI-led digital engineering market. The transaction is being executed through Galaxy Germany Holding SE, a wholly owned subsidiary of Persistent (referred to as 'BidCo').

Acquisition Details: Targeting Nagarro​

Persistent Systems plans to acquire 100% of the outstanding share capital of Nagarro SE, a global digital engineering and IT consulting company based in Munich, Germany. The acquisition involves a Business Combination Agreement (BCA) set out by the Board.

Key details of the proposed deal include:

• Acquisition Target: Nagarro SE, a digital engineering firm listed on the Frankfurt Stock Exchange.
• Transaction Structure: Acquisition through Galaxy Germany Holding SE (BidCo).
• Consideration: The acquisition is valued at not exceeding approximately EUR 1.05 Billion (~INR 112.73 Billion).
• Timeline: The transaction was announced on June 26, 2026, and the closure of the Takeover Offer is anticipated in Q4 CY2026/Q1 CY2027.

The Board concluded that the acquisition is highly complementary to Persistent’s existing strengths across technology, AI, and enterprise platforms, aiming to create a global AI-led digital engineering leader with combined revenues of approximately USD 2.9 Billion and over 46,000 employees across more than 40 countries.

Governance and Financial Highlights​

At the AGM, members will vote on several key governance matters and corporate financing structures:

• Dividend: Members are asked to approve the Interim Dividend of INR 22 per equity share (of INR 5 each) and a Final Dividend of INR 18 per equity share, aggregating to INR 40 per equity share for the Financial Year 2025-26.
• Director Reappointments: The AGM will address the reappointment of several senior leaders, including:

* Dr. Ambuj Goyal (Independent Director) from June 7, 2027, to October 31, 2031.
* Mr. Dan'l Lewin (Independent Director) from June 10, 2027, to April 30, 2029.
* Ms. Avani Davda (Independent Director), whose second term is proposed from December 28, 2026, to December 27, 2031.
* Mr. Arvind Goel (Independent Director) for a second term starting June 7, 2027, until June 6, 2032.
* Leadership: Dr. Anand Deshpande, Chairman and Managing Director, will be considered for reappointment as he retires by rotation.

Financing and Security Arrangements​

The proposed acquisition is supported by significant financial commitments involving the parent company of the subsidiary (Persistent). The AGM seeks approval for two material special resolutions relating to financing:

1. Corporate Guarantee: Approval for the Company to provide a corporate guarantee on behalf of BidCo, up to EUR 1.54 Billion (~ INR 165.34 Billion), in connection with the Bridge Financing Facility from Barclays Bank Plc (in consortium).
2. Collateral Creation: Approval to create a charge, pledge, and hypothecation by the Company on its assets—including shares of BidCo and receivables from inter-company loans advanced to BidCo—to secure the financing facility.

The related party transaction involves providing this corporate guarantee for up to EUR 1.54 Billion (not exceeding 110% of the Bridge Financing Facility).

Key Personnel Involvement in Transaction​

Both the Investment Committee and the Audit Committee recommended the proposed acquisition, noting that the transaction is commercially viable and aligns with strategic objectives. The transaction involves senior management from Persistent alongside members of the Management Board at Galaxy Germany Holding SE.

Key personnel authorized to execute the agreements include:

• Dr. Anand Deshpande (Chairman and Managing Director)
• Mr. Sandeep Kalra (Executive Director and Chief Executive Officer)
• Mr. Vinit Teredesai (Executive Director and Chief Financial Officer)
• Mr. Saurabh Dwivedi (Corporate Vice President - CFO Strategy Office)
• Mr. Amit Atre (Company Secretary)

Corporate Performance Snapshot​

Persistent delivered a strong financial performance for the year ended March 31, 2026. Revenue increased by 17.4% (USD) to $1,654.4 million (₹147,484 million). Profitability improved significantly, with EBIT and PAT rising by 31.5% and 33.2%, respectively, achieving EBIT and PAT margins of 15.6% and 12.6%.

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Summary of Key Resolutions at the AGM:

PERSISTENT Stock Price Movement​

On Friday, Persistent Systems Limited shares edged higher, closing at ₹5053.9 after gaining 4.21% from previous levels. The stock traded with a volume of 1,205,108 shares as it settled at market close.