Tech Mahindra, on Thursday, announced that it had signed a definitive agreement to acquire U.S.-based network services company Lightbridge Communications Corporation (LCC) for an enterprise value of about $240 million in an all-cash deal. This is the largest acquisition abroad and the second largest by Tech Mahindra after Satyam.
The acquisition is subject to regulatory approvals, and the transaction is expected to close by the fourth quarter of the company’s 2015 fiscal year, it said in a filing to the BSE. LCC, headquartered in McLean, Virginia, is one-of-the world’s largest independent global providers of network engineering services to the telecom industry. According to the filing, LCC employs more than 5,000 employees in over 50 countries.
“The acquisition will position Tech Mahindra as the pre-eminent partner for network services globally,” the company said.
This is the sixth acquisition made by the IT company in the last two years. In February, Tech Mahindra had acquired BASF Business Services Consult.
In February, 2013, Tech Mahindra had acquired Brazilian SAP consulting provider Complex IT for an undisclosed amount.
In 2012, it acquired Delhi-based vCustomer BPO for $27 million and also bought 100 per cent stake in Hutchison Global Services for $87 million. In the same year, Tech Mahindra had also acquired 51 per cent stake in VAS provider Comviva Technologies for around Rs.260 crore.
With annual revenues of more than $400 million, LCC has built 350 networks and designed more than 350,000 cell sites for over 400 customers worldwide.
Tech Mahindra Executive Vice-Chairman Vineet Nayyar said: “This partnership is another significant step towards the globalisation of Tech Mahindra as we welcome a diverse workforce of over 5,000 network professionals across five continents and more than 50 countries. We expect network services to be a major growth engine for our organisation.”
With this acquisition, Tech Mahindra intends to address the growing market opportunity as telecommunications companies and enterprises are accelerating the network upgrade cycle.
“We will now be the largest and most comprehensive provider of technology services to communications service providers.
“Our rich experience in delivering technology solutions to enterprises and communications service providers globally will be significantly strengthened by this acquisition,” said Tech Mahindra Managing Director and CEO C. P. Gurnani.
In April, 2013, Tech Mahindra had acquired the lab assets and operations of the Type Approval Lab, which was part of Sony Mobile Communication’s internal test function.