Feeds

Tech Mahindra to swallow Satyam in BILLION dollar deal

Indian outsourcers can't get enough of each other

Secure remote control for conventional and virtual desktops

The wonderful world of outsourcing is about to get a little bit smaller after Indian tech giants Tech Mahindra and Mahindra Satyam announced their intention to merge, creating India’s fifth-largest IT and outsourcing group by revenues.

In reality it is Tech Mahindra in the driving seat, as the outsourcing giant bought a controlling stake in Satyam in 2009 after the firm became embroiled in one of India’s biggest ever corporate scandals.

The $1bn (£630m) merger will give birth to a company with revenues of around $2.4bn (£1.5bn), a workforce of approximately 75,000 and over 350 clients across 54 countries, according to the firms.

However, Ovum analyst Ed Thomas warned that the saga is far from over.

“It will take the rest of the year for the merger process to be concluded and no name for the combined entity has yet been announced,” he said.

“On this latter point, it will be interesting to see if the Mahindra Group, which will own over one quarter of the new operation, decides to finally rid itself of the Satyam brand, which was badly tarnished by the accounting scandal that came to light in 2008.”

That scandal emerged when Satyam founder B Ramalinga Raju admitted he had been inflating profits at the firm by almost a billion pounds over several years.

The government was ultimately forced to step in and the company was offloaded to rival Tech Mahindra.

BT of course owns about a quarter of Tech Mahindra as it founded the firm in the mid 80s as a joint venture, so will get its mitts on 12.8 per cent of the new entity.

Unsurprisingly gushing statements from both sides of the table pointed to an “important new chapter” in the history of both firms.

"This merger will help propel the combined entity into the top tier of Indian software and services companies, achieving the [Mahindra] Group's key objective of being in a leadership role in each of our focus business areas," said Tech Mahindra chairman Anand Mahindra. ®

Internet Security Threat Report 2014

More from The Register

next story
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
Special pleading against mass surveillance won't help anyone
Protecting journalists alone won't protect their sources
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Apple's iPhone 6 first-day sales are MEANINGLESS, mutters analyst
Big weekend queues only represent fruity firm's supply
Radio hams can encrypt, in emergencies, says Ofcom
Consultation promises new spectrum and hints at relaxed licence conditions
Bill Gates, drugs and the internet: Top 10 Larry Ellison quotes
'I certainly never expected to become rich ... this is surreal'
Big Content Australia just blew a big hole in its credibility
AHEDA's research on average content prices did not expose methodology, so appears less than rigourous
EMC, HP blockbuster 'merger' shocker comes a cropper
Stand down, FTC... you can put your feet up for a bit
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
Saudi Petroleum chooses Tegile storage solution
A storage solution that addresses company growth and performance for business-critical applications of caseware archive and search along with other key operational systems.
WIN a very cool portable ZX Spectrum
Win a one-off portable Spectrum built by legendary hardware hacker Ben Heck
The next step in data security
With recent increased privacy concerns and computers becoming more powerful, the chance of hackers being able to crack smaller-sized RSA keys increases.