NIIT spurts after sale of US training unit

Shares of IT training company NIIT skyrocketed by nearly 20 per cent on the bourses on Monday after the companysaid it sold its US-based subsidiary, Element K Corporation, to SkillSoftCorporation for $110 million in an all-cash deal.

The stock, which opened the day on a robust note, jumpedfurther by 19.95 per cent to hit the upper circuit limit at Rs 52.30 on theBSE.

On the NSE, the stock shot up by 20 per cent to a high of Rs52.50.

However, within minutes, the stock pared some of the initialgains and was trading at Rs 50 on the BSE, up 14.68 per cent, and at Rs 49.85on the NSE, up 13.94 per cent, at 1151 hours.

NIIT acquired the 700-employee strong Element K for USD 35million in 2006.

The company has also entered into long-term services andlicencing agreements with SkillSoft to work together for producing new contentfor SkillSoft's e-learning content collections for business, IT and desktopskills.

The funds from the deal would be used to strengthen NIIT'sfour platforms - managed training services (MTS), cloud campus, its privateschool venture (NGuru) and university programme (YuvaJyoti).

The surge in the stock was in sharp contrast to the sluggishbroader market, with the BSE benchmark Sensex trading lower by 90.19 points at16,992.50 at 1151 hours.