TDCX minority shareholder wants MAS, SEC to scrutinize privatization offer

Photo credit: New York Stock Exchange

A minority investor of digital advertising solutions provider TDCX has filed a complaint with the Monetary Authority of Singapore and the US Securities and Exchange Commission (SEC), asking the regulators to scrutinize a privatization deal that is underway.

In particular, the shareholder V Mittal has drawn attention to Goldman Sachs’ role in the transaction. Goldman Sachs (Singapore) is serving as financial adviser to the group that is buying out the minority shareholders of TDCX.

See also: TDCX’s CEO aims to delist the BPO firm amidst struggling valuation

Mittal noted in the letter, a copy of which was seen by The Business Times, that Goldman Sachs & Co had acted as an underwriter in TDCX’s IPO.

TDCX raised US$349 million in its October 2021 IPO, selling its shares at US$18 each. The stock hit a peak of US$28.68 that same month but quickly lost momentum. It has not traded above US$10 since March 2023.

In January this year, TDCX founder Laurent Junique proposed to buy out minority shareholders and take the company private at US$6.60 per share.

The offer price has since been raised to US$7.20 per share – a premium to where TDCX was trading before the buyout announcement, but a disappointment to shareholders who had bought into the company’s story just a few years ago.

With the likes of Meta and Airbnb on its client list, TDCX had been touted by brokers as a tech disruption play.

According to Mittal’s letter, Goldman Sachs had a “strong buy” rating on the stock, starting with a price target of US$30.30 in November 2021.

Goldman Sachs Asset Management also held a 9.4% stake in TDCX as of February 8, 2024.

Mittal told The Business Times that his intent is not to stop the privatization but to get the regulators to scrutinize the parties in such transactions.

This is not Mittal’s first activist move. After Junique’s proposal was announced, Mittal had written to TDCX’s board and to a special committee convened by the board to consider the privatization offer.

In his letters, Mittal proposed share buybacks to boost the stock. He also asked that the special committee provide stockholders with access to its report or take input from minority shareholders.