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After months of speculation, finally the future of Mu Sigma looks clearer. Founder Dhiraj Rajaram has acquired a majority stake of 51.6% in the data analytics firm by buying out his estranged wife Ambiga Subramanian’s holdings and has taken over as the CEO of the firm by replacing her.
As per a Mint Report, Rajaram, who made the announcement yesterday, did not disclose who funded the deal. Before the deal, both he and Ambiga held a stake of around 25.5% in the company, he said. The data analytics firm, which was one of India’s earliest unicorns, had been facing uncertainty over future ownership and management on account of the divorce between Dhiraj and Ambiga this May.
Though Dhiraj declined to comment on the terms of the deal, purchase price, valuation, means of funding the transaction, and the company’s revenues, but said: “We are very profitable, and we’re absolutely a unicorn.” Mu Sigma’s existing investors General Atlantic and Sequoia Capital are expected to remain with the company. He added, “Financial terms between us will be mutually worked upon as a personal family matter.”
Ambiga, who was appointed as the CEO this February, will continue to serve on the board in a non-executive capacity. It was not immediately clear if she will continue to be associated with the firm once the transaction is completed. However, she has refuted speculations that she is planning to launch her own venture and that she refused to include a non-compete clause in the agreement. According to some media reports, both Rajaram and Subramanian have signed a non-compete agreement. In a statement, she clarified,
Due to personal circumstances, it is time for me to move on from the management team of the company and do something different. All rumours about me starting a competitive firm are untrue. While there is a lot of interest in the market to invest into a promising and profitable company like Mu Sigma, I have agreed to support Dhiraj’s interest to purchase my shares and get a controlling stake that will allow him to fulfill his vision.
The firm which counts Microsoft Corp., Wal-Mart Stores Inc., Dell Inc., and Pfizer Inc. as clients, has around 4,000 employees and competes with firms such as Tata Consultancy Services Ltd, Infosys Ltd and Wipro Ltd among others.
Earlier in 2013, Mu Sigma raised money from MasterCard in a deal that valued it at more than $1 Bn. So far, it has received funding in risk-capital from General Atlantic, Sequoia Capital, and Fidelity Investments etc. In all, Mu Sigma has raised about $178 Mn in funding in three rounds since 2011.
The stake sale finally puts an end to months of speculations around the firm’s future given the fact that the divorce between Dhiraj and Ambiga became fairly public, and caused much speculation over the control and the future of the company. Dhiraj admitted that their personal troubles had taken a toll on the company. He said,
It would be incorrect to say there hasn’t been any impact on business. There have been distractions on the personal front that led to impact on the supply side of business.
About nine out of 15 members of the leadership team have left ever since the couple separated. Dhiraj, however, had stated to ET that the people who quit were not a part of the leadership team but were “apprentice leaders”, with ranks below chief executive, geography head, regional head, and delivery leader.
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