India’s largest IT exporter Tata Consultancy Services (TCS) has bought additional 15% stake in Tata Consultancy Services Japan Limited (TCS Japan), its joint venture with Mitsubishi Corporation (MC) to enhance its shareholding to 66% for $32.5 million.
“TCS’ wholly owned subsidiary TCS Asia Pacific Pte. Ltd (TCS APAC), will acquire 15% stake from MC in TCS Japan for a total consideration of JPY 3.5 billion ($32.6 million) and consequently, the holding of TCS APAC in TCS Japan will go up from the current 51% to 66%,” the company said in filing to the exchanges.
“Both partners reiterated their commitment to the market and to the success of the joint venture,” said a company statement adding that the current governance of operations and management will remain unchanged by the share acquisition.
The increased equity is the latest in a series of investments that TCS has made in recent years to cater to the specific needs of Japanese corporations. To augment the local workforce and gain scale, a Japan-centric Delivery Center (JDC), with enhanced language support and heavy localisation of global business practices, was set up in 2015 within TCS Sahyadri Park in Pune, India.
“We are pleased to note that Mitsubishi Corporation is now more assured of the partnership, having experienced TCS’ services as a customer over the last 5 years, and that both companies continue their strong collaboration to grow the business together. Our joint venture has been a game-changer in the Japanese market, bringing scale and impact as companies look for technology partners that can help them ride the waves of digitisation and heightened global competition,” said Amur S. Lakshminarayanan, President and CEO, Representative Director, TCS Japan.
More recently, TCS chose Tokyo to set up its inaugural Pace Port, a creative hub to catalyse technology-led business innovation for Japanese customers.
Leveraging a unique hybrid model combining deep domain knowledge, technology expertise, and strong global and local execution, TCS Japan has achieved double-digit revenue growth in constant currency terms in each of the last two years, making it one of the fastest growing IT services firms in its class in Japan.
“TCS’ enhanced stake is a reflection of our steadfast commitment to our customers and our associates in Japan, and our longer term vision for the market. As our joint venture continues to grow in scale and sophistication, we look forward to playing a bigger role in our customers’ transformation journeys to become Business 4.0™ ready,” Mr. Lakshminarayanan added.
TCS shares on BSE closed up 1.11% at ₹2,275 in a weak Mumbai market on Monday, valuing the company at ₹8,53,667.52 crore, India’s most valued. The announcement came after the closure of market hours.
