Tech Mahindra on Tuesday announced the completion of Mahindra Satyam’s merger with itself. Post-merger, the new entity will become the fifth largest IT company in the country with revenues of $2.7 billion.
The announcement comes four years after the Mahindra Group acquired Satyam Computer Services post a multi-million dollar accounting scam by its founder Ramalinga Raju and rechristened it as Mahindra Satyam.
“Today we have fulfilled the commitment made in 2009, when we acquired Satyam, to jointly become one-of-the largest, diversified players leveraging technology for business solutions,” Anand Mahindra, Group Chairman, Mahindra & Mahindra, said.
The merged entity will be called Tech Mahindra and Anand Mahindra will be its Chairman. Tech Mahindra will aim to almost double the turnover to $5 billion by 2015 with focus on telecom, manufacturing and BFSI (banking, financial services, insurance).
“Over the past four years, we worked through the statutory and legal issues, our teams worked closely on the ground to integrate processes, eliminate overlaps, leverage best practices and deliver enhanced value to all our shareholders,” Tech Mahindra Executive Vice-Chairman Vineet Nayyar said.
Boards of Tech Mahindra and Mahindra Satyam approved the merger on March 21, 2012. After an approval from the Mumbai High Court, the merger had been awaiting clearances from Andhra Pradesh High Court, which gave nod on June 11, 2013.
Mr. Nayyar said that Milind Kulkarni would be the CFO of the combined entity which would have a team of 84,000 professionals, servicing 540 customers across 46 countries.
On the way forward, Tech Mahindra Managing Director C. P. Gurnani said, “We will continue to focus on telecom and manufacturing. And we strongly believe that by 2015 we will be a $5 billion company.”
Asked about Andhra Pradesh High Court’s order to continue investigations into the alleged fraud by B. Ramalinga Raju, Mr. Nayyar said: “There is no investigation pending against the company. We will fully co-operate on the continuing investigation.”
On share swap, Mr. Gurnani said the swap would take place on July 5 in the ratio of 8.5 shares of Satyam for every share of Tech Mahindra held.
Shares of Tech Mahindra closed at Rs.1,009.70 a piece on the BSE, up 1.02 per cent from its previous close.
