Shares of HCLTechnologies declined 2% to ₹1,315.65 apiece on the BSE today after the company issued a statement disclosing its plan to sell the entire 49% stake in its UK-arm in the US-based State Street joint venture (JV). In contrast to this, the broader BSE Sensex was trading 0.38% or 262.76 points higher at 69,127.88.

HCLTech Investments UK, a wholly-owned subsidiary of HCLTech, has signed a memorandum of understanding (MoU) with its JV partner, State Street International Holdings, a US-based financial services provider to institutional investors including investment servicing, investment management and investment research and trading, to sell the entire 49% stake in the JV to State Street for $170 million plus the net book value. State Street will have 49% of voting rights and 100% of dividend rights in the JV.

The company's filing states, “HCL Investments UK Limited, (“HCL UK”) a company incorporated in the UK and a step-down wholly owned subsidiary of the company has entered into a Memorandum of Understanding with its Joint Venture (JV) partner, State Street International Holdings, a US corporation (“State Street”), pursuant to which HCL UK is entering into discussions to finalize modalities for State Street to exercise its right of Call Option in the JV and acquire HCL UK’s entire 49% equity stake in the JV that was formed in the year 2012 to provide business operations services.”

The discussion on equity divestment is underway following the planned exercise of the call option by State Street, in regard to the agreement established between the parties HCLTech Investments UK and State Street International Holdings during the formation of the JV, it declares.

Although the activation of the call option and the corresponding consideration have been settled, the specifics, including modalities and other terms and conditions to execute this transaction, will be agreed upon between the parties in due course. The completion of the transaction is anticipated in the second quarter of the calendar year 2024 (Q2FY24), as per the filing.

“This integration is a natural evolution of our successful relationship with HCLTech, which remains a strategic technology partner,” said Mostapha Tahiri, executive vice president and incoming Chief Operating Officer of State Street Corporation,” Mostapha Tahiri, executive vice president and incoming Chief Operating Officer of State Street Corporation.

“State Street continues to be one of our strategic and top 15 clients in IT,” Srinivasan Seshadri, chief growth officer and global head, Financial Services, HCLTech.

Follow us on Facebook, Twitter, YouTube & Instagram to never miss an update from Fortune India. To buy a copy, visit Amazon.